CURRENCIES: Yen Gains Vs. Euro And Dollar After China Data

Date : 03/11/2010 @ 1:58AM
Source : Dow Jones News

CURRENCIES: Yen Gains Vs. Euro And Dollar After China Data

By Dow Jones

The yen rose against the dollar and euro, bouncing back from Thursday's disappointing Japanese economic-growth revision, after Chinese economic data raised investors' concerns that interest rates would rise.

China's February consumer-price index accelerated from the year-earlier month, to a greater-than-expected pace of 2.7%. Fixed-asset investment, bank lending and industrial-production data also beat most expectations.

The data initially weighed on higher-yielding, riskier currencies, "with the market speculating about the prospect of further Chinese tightening," said Sue Trinh, senior currency strategist at the Royal Bank of Canada.

Japan's low-yielding yen "was the biggest beneficiary in that environment," she said in e-mailed comments.

The greenback weakened against its Japanese counterpart, falling to 90.35 yen from 90.55 yen in late North American trading Wednesday. The euro slipped 0.1% to 123.30 yen.

Earlier Thursday, the yen came under pressure after the Japanese government revised fourth-quarter gross-domestic-product growth down Thursday, due to slightly weaker corporate capital expenditures and private inventories. The government also tweaked down a gauge measuring prices to show record-deep deflation.

The dollar index (DXY), which measures the U.S. unit against a trade-weighted basket of six major currencies, traded at 80.441, down from 80.484 late Wednesday.

The euro traded at $1.3647, compared with $1.3649 late Wednesday, and the British pound rose to $1.4978 from $1.4964

On Wednesday, the dollar fell versus the euro, reversing an earlier gain on stronger-than-expected manufacturing data in France and Italy.

 
 


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