Dollar Flat Vs Yen On View US Yields To Rise Again
-The dollar held its ground against the yen in Asia Friday, as investors bet that falls in U.S. Treasury yields overnight that had pushed the greenback down may prove short-lived.
Japanese importers also gave the U.S. currency a helping hand, buying it on a regular settlement day, dealers said.
At 0450 GMT, the dollar stood at Y83.69, unchanged from late Thursday in New York.
Investors' unwillingness to ditch the dollar despite a 5.3 basis point fall in the benchmark U.S. Treasury yield to 3.219% overnight suggests skepticism that yields will keep falling, dealers said. A strong 30-year Treasury auction Thursday drove the drop in yields, but dealers said broader forces that have pushed yields up in recent weeks could again prevail.
"The yield moves are now the biggest driver for the dollar-yen, but people want to see more data from the U.S., such as upcoming retail sales figures, to gauge where the yields are going now," said Hiroshi Maeba, a senior foreign exchange analyst at Nomura Securities. If yields pick up again in coming sessions the dollar could rise toward Y85 next week, Maeba said.
If U.S. economic indicators in the coming weeks add to evidence that the economy remains on a recovery track, despite lingering signs of sluggishness in the jobs market, that will pressure share prices and yields up, dealers said.
A Treasury dealer at a major Japanese securities house in Tokyo echoed the view that recovery in the Treasury market and sustained falls in yields may be some weeks off. "Yesterday's 30-year Treasury auction was a positive sign but I don't know that we're out of the woods yet," the trader said.
"There's a lot happening for year-end when banks and others concerned about their balance sheets are still selling Treasurys," keeping upward pressure on yields to the greenback's benefit, he said.
Meanwhile, the euro was up slightly against the dollar at $1.3254 at 0450 GMT from $1.3243 late Thursday in New York. The common currency also edged up against the yen, buoyed by Japanese importer buying, at Y110.91 from Y110.82.
The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies including the euro and yen, was at 79.978 from 80.019.
-The dollar held its ground against the yen in Asia Friday, as investors bet that falls in U.S. Treasury yields overnight that had pushed the greenback down may prove short-lived.
Japanese importers also gave the U.S. currency a helping hand, buying it on a regular settlement day, dealers said.
At 0450 GMT, the dollar stood at Y83.69, unchanged from late Thursday in New York.
Investors' unwillingness to ditch the dollar despite a 5.3 basis point fall in the benchmark U.S. Treasury yield to 3.219% overnight suggests skepticism that yields will keep falling, dealers said. A strong 30-year Treasury auction Thursday drove the drop in yields, but dealers said broader forces that have pushed yields up in recent weeks could again prevail.
"The yield moves are now the biggest driver for the dollar-yen, but people want to see more data from the U.S., such as upcoming retail sales figures, to gauge where the yields are going now," said Hiroshi Maeba, a senior foreign exchange analyst at Nomura Securities. If yields pick up again in coming sessions the dollar could rise toward Y85 next week, Maeba said.
If U.S. economic indicators in the coming weeks add to evidence that the economy remains on a recovery track, despite lingering signs of sluggishness in the jobs market, that will pressure share prices and yields up, dealers said.
A Treasury dealer at a major Japanese securities house in Tokyo echoed the view that recovery in the Treasury market and sustained falls in yields may be some weeks off. "Yesterday's 30-year Treasury auction was a positive sign but I don't know that we're out of the woods yet," the trader said.
"There's a lot happening for year-end when banks and others concerned about their balance sheets are still selling Treasurys," keeping upward pressure on yields to the greenback's benefit, he said.
Meanwhile, the euro was up slightly against the dollar at $1.3254 at 0450 GMT from $1.3243 late Thursday in New York. The common currency also edged up against the yen, buoyed by Japanese importer buying, at Y110.91 from Y110.82.
The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies including the euro and yen, was at 79.978 from 80.019.
