Dollar at one-month low against yen | Inquirer Business

Dollar at one-month low against yen

/ 11:36 AM July 29, 2013

AFP FILE PHOTO

TOKYO – The dollar slumped to its lowest level in a month against the yen in Asia on Monday as investors await a US central bank policy meeting for clues about the future of its stimulus program.

The greenback fetched 97.76 yen in Tokyo morning trade — its lowest since late June — against 98.20 yen in New York on Friday afternoon.

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The euro bought $1.3286 and 130.09 yen against $1.3278 and 130.48 yen.

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Eyes are on the two-day Federal Reserve meeting, with speculation growing that it may hold off winding down the $85-billion-a-month bond-buying scheme following a mixed bag of economic data.

Fed officials have said they would likely start reeling in the programme when the economy shows it can stand on its own.

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Investors are also waiting for the latest non-farm payrolls data and GDP data for the second quarter.

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“Expectations of a dovish Fed are weighing on the (dollar),” Kengo Suzuki, forex strategist at Mizuho Securities, told Dow Jones Newswires.

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Comments from Fed officials, including its chief Ben Bernanke, have kept investors guessing about a timeline for any pull-back.

A draw-down on Fed stimulus would mean fewer dollars sloshing around in the financial system, lifting demand and in turn sending the currency higher.

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“The outlook for (the dollar)… will be dominated by the ongoing conflict between US economic data and Fed policy rhetoric,” Credit Agricole said in a note.

The European Central Bank will hold a policy meeting Thursday but analysts say improving figures for the eurozone mean policymakers will likely to hold off cutting interest rates for the time being.

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TAGS: currency, economy, Foreign Exchange, US

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