Sunday 28 June 2009

WORLD FOREX: Dlr Up Vs Yen; FOMC, Stocks Fuel Risk Appetite

By Takashi Mochizuki

TOKYO (Dow Jones)--Higher Japanese stock prices and a positive outcome from the Federal Open Market Committee meeting overnight revved up players' risk appetite, lifting the dollar and euro up against the yen in Asia Thursday.

The U.S. currency will likely rise for the rest of this week, some dealers said, because the FOMC did not take additional stimulative measures such as boosting its Treasury purchase program.

Some investors had expected the FOMC might increase its future Treasury buying to support the U.S. economy, which is usually a negative factor for the dollar as the nation's interest rates decline.

"Reading market sentiment is fairly easy today: players are taking positive cues from the FOMC and stock prices to buy dollars and euros," said Jun Kato, a senior dealer at Shinkin Central Bank.

Japan's benchmark Nikkei 225 Stock Average stood at 9822.66 as of 0450 GMT, up 232.34 from Wednesday's close.

The pace of the dollar's climb, however, will likely be slow because players are unwilling to make aggressive bets ahead of non-farm payrolls data and business activity indexes from the Institute for Supply Management due next week, said's senior dealer Tsuyoshi Ueda.

"Ahead of the data releases, the market lacks a decisive factor to make a strong, long-term trend in the currency market," he said.

Other dealers have similar views, saying Y98 is a cap for the dollar for the time being.

Later in the global day, market participants will turn their attention to U.S. weekly jobless data, and if the result shows an improvement and pushes up U.S. stock prices, the dollar may extend its climbs, dealers noted.

The data may record 605,000 claims, which is slightly better than the 608,000 claims in the previous period, according to a Dow Jones poll of economists.

The euro, meanwhile, rose against the dollar and yen. Dealers said the European currency is expected to keep rising unless European Central Bank officials say something surprising, dealers said. The bank's executive board member Juergen Stark will make a speech later in the day.

So far in Asia, Japanese importers and security firms and non-Japanese commodity trading advisors were seen selling the yen for the dollar, euro and Australian dollar, dealers said.

Interbank Foreign Exchange Rates At 00:50 EDT / 0450 GMT
Latest Previous %Chg Daily Daily %Chg
USD/JPY Yen 96.22-27 95.61-63 +0.64 96.28 95.62 +6.20
EUR/USD Euro 1.3960-66 1.3926-29 +0.24 1.3975 1.3928 -0.13
GBP/USD Sterling 1.6451-55 1.6408-12 +0.26 1.6467 1.6414 +12.48
USD/CHF Swiss Franc 1.0952-58 1.0978-84 -0.24 1.0986 1.0948 +2.65
USD/CAD Canadian Dlr 1.1538-44 1.1566-71 -0.24 1.1563 1.1534 -5.15
AUD/USD Australian Dlr 0.8004-09 0.7956-61 +0.60 0.8013 0.7961 +13.16
NZD/USD New Zealand Dlr 0.6415-17 0.6384-90 +0.49 0.6420 0.6386 +9.94
EUR/JPY Yen 134.38-40 133.14-19 +0.93 134.41 133.34 +6.11

-By Takashi Mochizuki, Dow Jones Newswires; 813-6895-7554;

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