By Hiroyuki Kachi
The euro was a tad lower against the dollar and yen in Asian
trade Friday, after losing ground in the wake of the European
Central Bank's decision to go ahead with its massive asset
purchasing program.
ECB President Mario Draghi said the central bank would buy EUR60
billion ($69 billion) of public and private-sector debt every month
until at least September 2016, or even later if needed. The move is
aimed at supporting growth and lifting inflation expectations in
the eurozone.
Around 0450 GMT, the euro was at $1.1345, compared with $1.1361
late Thursday in New York. The common currency hit as low as
$1.1316 overnight before stabilizing to the latest level. The
single currency also was at Y134.51 from Y134.65.
Investors were "not fully responding during Tokyo time" to the
ECB's policy move to adopt quantitative easing given the proximity
of the Greek election on Sunday, said a senior Japanese bank
dealer.
But the dealer said the ECB's robust stance over monetary easing
will likely set to the euro to give it the status of the weakest
major currency in the world, adding that a fall in the euro to as
far as the $1.100 range is very likely.
"To be honest, I was expecting a market reaction of something
like sell the fact" in the forms of the forms of higher yields,
stock weakness and the euro's rebound, said Osamu Takashima, chief
FX strategist at Citigroup Global Markets Japan, Mr. Takashima in a
morning note. But the market is accepting the upside surprise from
the ECB's action with no protests in what may suggest "the
financial market's stronger-than-expected recovery toward risk
appetite," he said.
Elsewhere in Asia, stock markets showed a warm reception to the
ECB's massive easing program. The Nikkei Stock Average rose 1.0%
midday, while the Shanghai Stock Exchange Composite Index was last
up 1.4%.
Shinji Kureda, head of FX trading group at Sumitomo Mitsui
Banking Corp. said the monetary easing mood across the globe is a
boon to riskier assets such as stocks that may help benefit the
dollar-yen trading pair the most.
The dollar was at Y118.58, almost unchanged from Y118.56 in late
Thursday trade in New York.
Soon after the ECB steps overnight, Denmark cut its main
interest rate on Thursday for the second time this week as it
sought to damp interest in its currency among investors selling the
euro. Earlier this week, Canada dropped its benchmark overnight
rate Wednesday, citing it as "insurance" against the potential
economic toll of plunging prices for oil, a key Canadian
export.
The WSJ Dollar Index, a measure of the dollar against a basket
of major currencies, was up 0.15% at 85.06.
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 118.60-61 118.49-50 +0.09 118.83 118.24 -0.94
EUR/USD Euro 1.1341-44 1.1366-69 -0.22 1.1374 1.1340 -6.25
GBP/USD U.K. 1.4989-94 1.5010-15 -0.14 1.5029 1.4991 -3.77
USD/CHF Switzerland 0.8718-22 0.8713-17 +0.06 0.8731 0.8681 -12.30
USD/CAD Canada 1.2389-94 1.2380-85 +0.07 1.2399 1.2361 +6.63
AUD/USD Australia 0.7991-95 0.8025-29 -0.42 0.8054 0.7991 -2.18
NZD/USD New Zealand 0.7492-98 0.7500-06 -0.11 0.7528 0.7492 -3.85
Euro Rate
EUR/JPY Japan 134.50-54 134.71-75 -0.16 135.07 134.40 -7.19
Source: ICAP PLC
Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com