Dollar stronger in Asia on economic data

AP FILE PHOTO

TOKYO – The dollar strengthened in Asian trade on Monday after positive economic data last week boosted optimism about the world’s largest economy, and cut the chances of further monetary easing.

The greenback bought 79.57 yen against 79.55 yen in New York late Friday, while the euro was worth $1.2321, down from $1.2330 in US trade.

The euro was at 98.06 yen in Tokyo morning trade, from 98.10 yen.

The common European currency’s decline came amid dollar buying on the heels of US economic reports including a new survey released Friday that showed consumers were a little more upbeat than in July.

“The euro/dollar is top-heavy as the dollar is bought,” Junichi Ishikawa, forex analyst at IG Market Securities in Tokyo, told Dow Jones Newswires.

The data reduced the likelihood of further monetary easing by the US Federal Reserve, which would generally weaken the currency.

Traders would turn their focus to Wednesday’s release of the minutes from the most recent meeting of the Fed’s Open Market Committee, dealers said.

The euro, meanwhile, was supported by expectations that the European Central Bank would purchase struggling eurozone countries’ sovereign debt following a report in the Germany newsweekly Der Spiegel, Ishikawa said.

The report Sunday said that the ECB was considering buying the bonds of crisis-wracked eurozone countries to help contain their borrowing costs.

The bank would set an upper limit for borrowing costs in countries such as Spain and Italy and

intervene in the markets if necessary to ensure the limits were not breached, the report said, without citing its sources.