Dollar under pressure amid US economic concerns
The dollar traded marginally lower against the yen in Asia on Thursday, hit by weak US data and a worsening outlook for the world's biggest economy, dealers said.business Updated: Jul 15, 2010 15:42 IST
The dollar traded marginally lower against the yen in Asia on Thursday, hit by weak US data and a worsening outlook for the world's biggest economy, dealers said.
The dollar was quoted at 88.08 yen in Tokyo afternoon trade, down from 88.27 yen in New York late Wednesday. The euro fetched 1.2725 dollars and 112.10 yen, down from 1.2743 dollars and 112.62 yen.
Concerns about the US economy grew after government data showed retail sales had fallen more than expected in June for a second straight month.
Sentiment worsened further after the Federal Reserve revealed minutes from a June meeting of its policy-setting Federal Open Market Committee (FOMC).
They showed that board members had cut their growth forecast to 3.0-3.5 percent this year, down from the 3.2-3.7 predicted just months ago, and that the Fed was weighing new measures to keep the faltering US recovery on track.
The minutes may cause players in Asia to remain bearish on the dollar due to heightened expectations that US rates will remain ultra-low for the time being, said Mitsubishi UFJ Trust and Banking forex dealer Hideaki Inoue.
But no sharp currency drops are expected, he said.
"While negative for the dollar-yen, the FOMC minutes weren't outside the range of expectations," he told Dow Jones Newswires.
Pessimists may be gaining force among Fed board members in the face of a sagging housing market, high jobless rate and weak capital, Credit Suisse said in a note.
"The FOMC is expected to take a wait-and-see stance for a while but may seek additional credit easing if it sees a clearer slowdown in the economy from autumn on," it said.
The dollar was mixed against other Asian currencies, rising to 46.31 Philippine pesos from 46.27 Wednesday and to 9,046.25 Indonesian rupiah from 9,040.00, while falling to 32.13 Taiwanese dollars from 32.14.
The greenback was flat at 1.3759 Singaporean dollars and 32.30 Thai baht.