By Hiroyuki Kachi 
 

The dollar was moderately lower during Asian trade on Friday, with many investors avoiding major moves ahead of Donald Trump's inauguration speech later in the day.

The WSJ Dollar Index, a measure of the U.S. dollar against a basket of major currencies, was down 0.11% at 91.70.

The greenback gained upside momentum to hit as high as Y115.15 in mid-morning Asian trade, after its overnight gains following comments from Mr. Trump's Treasury secretary pick Steven Mnuchin that the U.S. prefers a strong dollar. But the dollar later lost the earlier gains to change hands at Y114.73 around 0450 GMT, compared with Y114.85 late Thursday in New York.

The dollar's gains earlier in the session was likely due to buying by Japanese corporate players including importers who picked up the dollar for regular commercial trading settlement. Its subsequent weakness later in the session suggests investors were taking a cautious line ahead of Mr. Trump's comments later Friday.

The dollar's upside was also limited because there was nothing new from Fed Chairwoman Janet Yellen's speech midday. Ms. Yellen said she considered it prudent to raise rates "gradually over time."

"Investors seemed to have felt a sense of accomplishment," as the dollar successfully broke above its key resistance of Y115 again in Asia, said Daisaku Ueno, chief FX strategist at Mitsubishi UFJ Morgan Stanley. However, investors largely remained reluctant to test further upside ahead of Mr. Trump's speech, he said.

"We don't expect the new administration putting as much pressure on the dollar as investors anticipate," said Mizuho Securities chief FX strategist Kengo Suzuki in a note.

He expects the dollar will likely remain firm for now and then take several weeks to go upside. Mr. Suzuki doesn't expect specific policy details from the inauguration speech, meaning that investors will have to wait until next month's budget proposals.

The U.S. currency touched a one-week high of Y115.62 overnight after Mr. Mnuchin said in his confirmation hearing that "the long term strength of the dollar is important." His comments came after Mr. Trump told The Wall Street Journal that he would prefer a weaker dollar.

"The currency is very, very strong and what you see is people all over the world wanting to invest in the U.S. currency," Mr. Mnuchin said. "The U.S. currency has been the most attractive currency to be in for a very, very long period of time."

The euro gained to $1.0679 from $1.0661 late Thursday. The common currency lost ground overnight after European Central Bank President Mario Draghi pledged to continue the bank's massive bond-purchase program through the end of the year.

In other currency trades, the euro was at Y122.57 from Y122.45 late Thursday.

 
Interbank Foreign Exchange Rates At 23:50 EST / 0450 GMT 
 
                           Latest       Previous   %Chg    Daily    Daily   %Chg 
Dollar Rates                               Close            High      Low  12/31 
 
USD/JPY Japan           114.72-73      114.86-87  -0.12   115.12   114.55  -1.95 
EUR/USD Euro            1.0679-82      1.0663-66  +0.15   1.0695   1.0653  +1.53 
GBP/USD U.K.            1.2353-55      1.2340-42  +0.11   1.2373   1.2329  +0.07 
USD/CHF Switzerland     1.0045-49      1.0060-64  -0.15   1.0071   1.0035  -1.39 
USD/CAD Canada         1.3299-304      1.3316-21  -0.13   1.3332   1.3286  -1.04 
AUD/USD Australia       0.7574-78      0.7560-64  +0.19   0.7589   0.7554  +5.19 
NZD/USD New Zealand     0.7205-11      0.7187-93  +0.25   0.7226   0.7177  +4.09 
 
Euro Rate 
 
EUR/JPY Japan           122.53-57      122.48-52  +0.04   122.73   122.36  -0.45 
 
 
Source: Tullett Prebon 
 

Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com

(END) Dow Jones Newswires

January 20, 2017 00:27 ET (05:27 GMT)