Alexa

Strong core consumer price data fails to boost yen in Asian trade

Strong core consumer price data fails to boost yen in Asian trade

The U.S. dollar nudged higher against other major currencies in quiet Asian trade yesterday as the market showed little reaction to the first rise in Japanese consumer prices for over two years, dealers said.

Since overseas markets were closed on Monday for Christmas holidays, activity was still sluggish in Tokyo, they added.

The dollar rose to 117.10 yen in Tokyo afternoon trade from 116.47 yen in late afternoon Tokyo trade Monday. The euro slipped to US$1.1838 compared with US$1.1842 while firming to 138.59 yen from 137.87 yen.

"Due to the absence of major foreign players, trading has been extremely thin and choppy, with only technical deals driving the market," Mizuho Corporate Bank foreign exchange manager Tatsuro Karitani said.

The dollar saw active buying support from Japanese importers below the 117 yen level, dealers said.

The Japanese unit failed to gain a boost from news that core consumer prices in Japan posted their first rise in more than two years in November, increasing by 0.1 percent from a year earlier.

The core consumer price index (CPI), which excludes volatile fresh food costs but includes energy prices, marked the year-on-year rise in line with market expectations after staying flat in October, the government said.

Although the headline CPI figure rose, "considering the economic environment such as higher oil prices, a rise in the CPI was not taken positively in the market," said Shinsei Bank currency watcher Mamoru Ashimoto.

Foreign investors were expected to return to the market later yesterday after the Christmas holiday but activity is likely to be fairly subdued until the new year, he said.

"The dollar may strengthen against the yen because of U.S. corporations repatriating overseas earnings. But this is only a seasonal factor. Market trade will resume fully from January," Ashimoto said.


Updated : 2021-03-05 06:33 GMT+08:00