Forex - US dollar rebounds early in Asian session

Forex - US dollar rebounds early in Asian session

	Published : Mon, 16 Jul 2007 02:05 By : Agencies Print this Story

SYDNEY (Thomson Financial) - The US dollar was higher against the yen and euro early in Asian trading hours Monday, regaining some of the ground it lost Friday after the release of data showing retail sales in the US fell 0.9 percent in June.

A public holiday in Japan should ensure that currencies stay within their present ranges until the European session begins.

At 10.02 am here (0002 GMT), the dollar was at 122.08 yen, up from 121.93 yen in late trading in New York Friday. The euro was at 1.3776, down from 1.3783 dollars in New York.

NAB Capital said sentiment towards the greenback remained weak, despite the University of Michigan survey having shown Friday that consumer confidence in the US rose in July and despite the Dow Jones Industrial Average and S&P 500 indices having hit new record highs.

NAB Capital said the yen had also gained on its own merits against both the US dollar and euro Friday, on reports that Iran had asked Japan to make future payments for oil in yen rather than dollars. Iran is Japan's third biggest supplier of oil, and Japanese oil importers typically hedge by using yen to buy around one billion US dollars per month.

'The unwinding of currency hedges will likely produce some selling in the US dollar against the yen and it will be interesting to see what effect this may have on Australian dollar versus the yen,' NAB Capital said.

The market is likely to focus later Monday on the release of the latest consumer price inflation data for the euro zone in general and Germany in particular, and on the results of the New York Empire State manufacturing survey for July in the US.

But the US dollar's fortunes this week are likely to depend on the US producer price inflation figures, due out Tuesday, and the US consumer price inflation figures, due out Wednesday, on Federal Reserve chairman Ben Bernanke's semi-annual testimony to the US Congress and on various housing market indicators.

Sydney 10.02 am (0002 GMT)

US dollar

122.08 yen

1.2033 sfr

Euro

1.3776 usd

168.13 yen

1.6576 sfr

0.6775 stg

Sterling

2.0335 usd

248.14 yen

2.4468 sfr

Australian dollar

0.8706 usd

0.4280 stg

106.23 yen

New Zealand dollar

0.7879 usd

paul.daniel@thomson.com

pd/jm

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