Euro falls in Asia despite positive data

TOKYO—The euro fell against other major currencies in Asia on Wednesday as Europe’s continuing debt woes overwhelmed positive data coming out of the continent.

The euro bought $1.3025 and 99.85 yen in Tokyo midday trade, down from $1.3051 and 100.10 yen in New York late Tuesday.

The dollar stayed weak against the Japanese yen, trading at 76.66 yen compared with 76.68 yen in New York.

The euro had resisted falls in early Wednesday trade, propped up by solid European manufacturing data and a bigger-than-expected drop in the number of jobless Germans in December for a post-reunification low of 6.8 percent.

But the currency fell after relatively large bids around 1.3045 were cancelled.

“I had expected the euro to recover more, but the limited gains reinforce the view that the bearish trend for the euro will not be altered so easily,” said Mizuho Trust and Banking trader Yoshio Yoshida.

The euro was weighed by potential sovereign rating downgrades in the eurozone while Italian government bond yields hover just below the seven percent level deemed unsustainable for a country to service its debt.

The euro had fallen to 98.71 yen earlier this week, an 11-year low.

The dollar could fall below 76.00 yen within a week or so if the present risk-on trade continues as dealers sell the dollar in light of upbeat US data, said Junya Tanase, chief currency strategist at JPMorgan in Tokyo.

“If the risk-on trade goes on, it won’t be surprising if the pair tests 76.30 first and then 76.00,” he said.

The dollar hit its post World War II-low of 75.32 yen in late October, prompting Japanese authorities to step into markets and sell the yen to safeguard exports.

US criticism of the Japanese intervention would make it difficult for Japan to undertake another large-scale intervention, he added.