Dollar extends gains in Asia
Dollar rose further in Asia Wednesday as investors weighed prospects of a US economic recovery after Washington unveiled a plan to unclog the banking system of bad debt.
By Agencies |
TOKYO: The dollar rose further in Asia Wednesday as investors weighed prospects of a US economic recovery after Washington unveiled a plan to unclog the banking system of bad debt.
The dollar gained to 97.97 yen in Tokyo morning trade from 97.86 in New York late Tuesday. The euro slipped to 1.3475 dollars from 1.3516 but rose to 132.01 yen from 131.87.
The greenback gained despite a slump on Wall Street Tuesday, which analysts said was the result of profit-taking a day after shares surged nearly seven percent on news of Washington's toxic debt plan.
"The dollar continues to be supported as investors are finally seeing a glimmer of good news after being mired in darkness for months," said Ryohei Muramatsu, manager of Commerzbank's Group Treasury Asia in Tokyo.
"While it's still too early to say that market sentiment is turning optimistic, there is mounting anticipation of a US economic recovery later this year, followed by the rest of the world," he said.
US President Barack Obama's administration Monday announced a public-private sector program to help the ailing banking system recover from massive losses suffered in the US real estate meltdown.
"It is hoped the dramatic policy measures will help stimulate US growth," NAB Capital strategist John Kyriakopoulos wrote in a note.
"Meanwhile investors are unsure whether or not to believe the glimmers of hope on the horizon, uncertain whether or not the worst of the financial crisis and global recession is behind us," he said.
The euro was weighed down by growing expectations of more interest rate cuts by the European Central Bank and speculation that it may adopt unorthodox measures to shore up the financial system, dealers said.
Markets gave a muted reaction to news of a record 49.4 percent year-on-year fall in Japanese exports in February because it had been widely expected following a sharp drop the previous month.
Traders were digesting comments from Obama, who described the dollar as "extraordinarily strong" and rejected a call from China's top central banker for a new international reserve currency.
He said that although the United States was "going through a rough patch," it enjoyed a "great deal of confidence" from investors.
"I don't believe there is a need for a global currency," he said.
The dollar gained to 97.97 yen in Tokyo morning trade from 97.86 in New York late Tuesday. The euro slipped to 1.3475 dollars from 1.3516 but rose to 132.01 yen from 131.87.
The greenback gained despite a slump on Wall Street Tuesday, which analysts said was the result of profit-taking a day after shares surged nearly seven percent on news of Washington's toxic debt plan.
"The dollar continues to be supported as investors are finally seeing a glimmer of good news after being mired in darkness for months," said Ryohei Muramatsu, manager of Commerzbank's Group Treasury Asia in Tokyo.
"While it's still too early to say that market sentiment is turning optimistic, there is mounting anticipation of a US economic recovery later this year, followed by the rest of the world," he said.
US President Barack Obama's administration Monday announced a public-private sector program to help the ailing banking system recover from massive losses suffered in the US real estate meltdown.
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"It is hoped the dramatic policy measures will help stimulate US growth," NAB Capital strategist John Kyriakopoulos wrote in a note.
"Meanwhile investors are unsure whether or not to believe the glimmers of hope on the horizon, uncertain whether or not the worst of the financial crisis and global recession is behind us," he said.
The euro was weighed down by growing expectations of more interest rate cuts by the European Central Bank and speculation that it may adopt unorthodox measures to shore up the financial system, dealers said.
Markets gave a muted reaction to news of a record 49.4 percent year-on-year fall in Japanese exports in February because it had been widely expected following a sharp drop the previous month.
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Traders were digesting comments from Obama, who described the dollar as "extraordinarily strong" and rejected a call from China's top central banker for a new international reserve currency.
He said that although the United States was "going through a rough patch," it enjoyed a "great deal of confidence" from investors.
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"I don't believe there is a need for a global currency," he said.
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