Alexa

Dollar higher against yen in Asian trading

Dollar higher against yen in Asian trading

The dollar strengthened against the yen Tuesday in Asian trading as investors sold the Japanese currency after Japan's inflation data failed to show a significant increase in prices.
The dollar bought 118.96 yen by mid-afternoon in Tokyo, up from 118.84 yen late Monday in Tokyo. The euro fell to US$1.3124 from US1.3143.
New York financial markets were closed Monday for Christmas.
Japan's core consumer price index, released early in the Asian session, showed a 0.2 percent on-year rise in November. The figure matched the average forecast of economists.
But the currency players interpreted the result as not strong enough to support an interest rate hike next month by the country's central bank. The view spurred players to push the American currency to a high of 119.00 yen versus the yen on EBS, traders said.
In the remaining trading days this year, players will likely continue to lift the greenback against the yen, as the dollar has been rising close to this year's highs of above 119.00 yen, traders said.
"If the U.S. unit breaks above 119 yen, it may jump to 119.25 yen," said Osao Iizuka, head of foreign exchange trading at Sumitomo Trust and Banking Co.
Iizuka said that an upward trend of the dollar versus the yen will also be supported by buying of cross-yen currencies, such as the New Zealand and Australian dollars. To buy a so-called cross-yen unit, players usually exchange dollars for yen first, and then purchase a designated currency so that players can make a deal at a fair price.
Besides the CPI figures, Japanese government data showed household spending for November declined 0.7 percent on year _ an improvement from a 2.4 percent fall in October and slightly better than the 1.5 percent drop expected by economists.
Meanwhile, Japan's jobless rate for November improved to 4.0 percent, beating the economists' forecast at 4.1 percent.
"As far as the overall data show improvement, the Bank of Japan will still be able to bump up rates in the near term," said Masafumi Yamamoto, a market economist at Nikko Citigroup. "We need to see more data. There's still a chance that the BOJ will raise rates in January."
Looking ahead, the Japanese government will release November retail sales data on Wednesday and industrial production figures on Thursday.
Against other Asian currencies, the dollar was mostly higher, rising to 3.5385 Malaysian ringgit from 3.5345 the previous day, and to 929.7 South Korean won from 928.2. It fell to 9,074 Indonesian rupiah from 9,075, however.


Updated : 2020-12-02 03:13 GMT+08:00