TOKYO (AFX) - The US dollar was little changed against major currencies, as the market continues to debate the likely outcome of next week's G-7 meeting, dealers said.
Calion foreign exchange manager Takashi Kudo said: "Given recent comments from European officials, pressure on Asian currencies to appreciate could gain momentum once again in the run-up to the G-7 meeting next week."
German Finance Minister Nans Eichel said yesterday major emerging economies in Asia must go in the direction of taking greater responsibility for global demand, which could come through modifications in exchange rates or in market opening.
French Finance Minister Herve Gaymard said: "Asia should engage in greater currency flexibility."
At 12.35 pm here (0335 GMT) the dollar was trading at 102.70 yen, compared to 102.61 yen in Sydney and 102.60 in late New York trade, while the euro was at 1.3029 usd, from 1.3039 usd in Sydney and 1.3056 in New York.
"The market is increasingly becoming worried about the possibility of a change to the forex statement at the G-7 meeting," Calion's Kudo said.
But US Treasury Secretary John Snow said overnight he did not expect finance ministers from the seven richest nations to tinker with the wording in their official statement on currency markets.
The confinement of the dollar's movement to a narrow range was also due to growing caution ahead of the release later this week of US GDP data and the release next week of US non-farm payroll data, dealers said, as the market will try to get a picture of US interest rate trends from these data, following weak consumer sentiment figures.
The University of Michigan said Friday the consumer sentiment index fell to 95.8 in January from 97.1 in December. These data triggered active unwinding of long dollar positions, as it encouraged the view that the US Fed may not quickly hike interest rates, as the market had previously expected.
"The bull-run of the dollar based on an interest differential story might have already run out of steam, and forthcoming US data, such as GDP, may not offer any more support for the dollar," Kudo said.
Tokyo 12.35 pm (0335GMT) Sydney 11.10 am (0010 GMT)
US dollar
yen 102.70 up from 102.61
sfr 1.1856 up from 1.1851
Euro
usd 1.3029 down from 1.3039
stg 0.6934 down from 0.6939
yen 133.28 down from 133.81
sfr 1.5446 down from 1.5453
Sterling
usd 1.8789 up from 1.8786
yen 192.96 up from 192.79
sfr 2.2276 up from 2.2257
Australian dollar
usd 0.7699 down from 0.7703
stg 0.4098 down from 0.4101
yen 79.069 up from 79.060
Yasuhiko.Seki@Xfn.com
ys/jm
For more information and to contact AFX: www.afxnews.com and www.afxpress.com
Calion foreign exchange manager Takashi Kudo said: "Given recent comments from European officials, pressure on Asian currencies to appreciate could gain momentum once again in the run-up to the G-7 meeting next week."
German Finance Minister Nans Eichel said yesterday major emerging economies in Asia must go in the direction of taking greater responsibility for global demand, which could come through modifications in exchange rates or in market opening.
French Finance Minister Herve Gaymard said: "Asia should engage in greater currency flexibility."
At 12.35 pm here (0335 GMT) the dollar was trading at 102.70 yen, compared to 102.61 yen in Sydney and 102.60 in late New York trade, while the euro was at 1.3029 usd, from 1.3039 usd in Sydney and 1.3056 in New York.
"The market is increasingly becoming worried about the possibility of a change to the forex statement at the G-7 meeting," Calion's Kudo said.
But US Treasury Secretary John Snow said overnight he did not expect finance ministers from the seven richest nations to tinker with the wording in their official statement on currency markets.
The confinement of the dollar's movement to a narrow range was also due to growing caution ahead of the release later this week of US GDP data and the release next week of US non-farm payroll data, dealers said, as the market will try to get a picture of US interest rate trends from these data, following weak consumer sentiment figures.
The University of Michigan said Friday the consumer sentiment index fell to 95.8 in January from 97.1 in December. These data triggered active unwinding of long dollar positions, as it encouraged the view that the US Fed may not quickly hike interest rates, as the market had previously expected.
"The bull-run of the dollar based on an interest differential story might have already run out of steam, and forthcoming US data, such as GDP, may not offer any more support for the dollar," Kudo said.
Tokyo 12.35 pm (0335GMT) Sydney 11.10 am (0010 GMT)
US dollar
yen 102.70 up from 102.61
sfr 1.1856 up from 1.1851
Euro
usd 1.3029 down from 1.3039
stg 0.6934 down from 0.6939
yen 133.28 down from 133.81
sfr 1.5446 down from 1.5453
Sterling
usd 1.8789 up from 1.8786
yen 192.96 up from 192.79
sfr 2.2276 up from 2.2257
Australian dollar
usd 0.7699 down from 0.7703
stg 0.4098 down from 0.4101
yen 79.069 up from 79.060
Yasuhiko.Seki@Xfn.com
ys/jm
For more information and to contact AFX: www.afxnews.com and www.afxpress.com
© 2005 AFX News
