Fri Feb 17, 2012 2:03am EST
* Dollar/yen rises on stops, Japan importer bids
* Nears Oct. 31 post-intervention arise of 79.553 yen
* Aussie/yen hits 6-1/2 mth high, concentration on toushin launch
* Greek bailout hopes, upbeat U.S. information lift risk appetite
By Hideyuki Sano and Masayuki Kitano
TOKYO/SINGAPORE, Feb 17 (Reuters) – The dollar strike a
3-1/2 month high contra a yen on Friday as upbeat U.S.
economic information combined fuel to a convene sparked by a Bank of
Japan’s financial easing progressing in a week.
The dollar’s arise also gained steam on stop-loss buying, and
active bids from Japanese importers who have been held off
guard by a new strength, traders said.
The yen fell broadly, attack a 6-1/2 month low contra the
Australian dollar and a two-month tray opposite a euro, as
the Japanese banking extended a waste after a BOJ
surprised markets this week by boosting a item shopping scheme
by $130 billion and environment an acceleration idea of 1 percent.
“The near-term seems extremely expected to take dollar/yen
higher,” pronounced Ray Farris, arch Asia strategist for Credit
Suisse in Singapore.
The dollar will substantially conduct aloft opposite a yen, with
yield spreads commencement to pierce aloft in a favour, Farris
said, adding that a focal indicate in entrance months will be whether
the BOJ conducts serve easing if indispensable to grasp its
inflation goal.
The dollar rose to a high of 79.18 yen on trading
platform EBS during one point. That was a dollar’s top level
against a yen given Oct. 31, when Japan sole a record 8.07
trillion yen in banking involvement after a dollar strike a
post-World War Two record low of 75.311 yen.
The dollar final stood during 79.14 yen, adult 0.3 percent from late
U.S. trade on Thursday.
The dollar is adult about 2 percent so distant this week against
the Japanese currency, on lane for a biggest weekly gain
since a week travelling a finish of Oct and early November,
when Japan conducted a large yen-selling intervention.
“Buying by suppositional accounts has been a categorical motorist of
this pierce higher,” pronounced a merchant for a vital Japanese bank in
Singapore, referring to a dollar’s new rise.
“Sizeable dollar/yen shopping flows from (offshore)
real income investors who had formerly been prolonged yen, have also
been spotted,” a merchant said.
The dollar, that breached a 200-day relocating average
earlier this week, is now contrast a 55-week relocating normal at
79.12 yen. Above that, a dollar’s post-intervention high on
Oct. 31 lies during 79.553 yen.
“We are relocating above some flattering engaging technical
levels that support this longhorn run,” pronounced a U.S.-based FX trader.
One indicate to watch is either a dollar manages to tighten the
week above a 55-week average, he said.
Higher up, a dollar faces vital insurgency in a 79.73 to
80.94 yen area, a operation shaped by a cloud on a weekly
Ichimoku chart, a renouned technical research tool.
The euro clung to a prior day’s gains, upheld by
hopes that Greece was tighten to clinching a second bailout
package. The singular banking was small altered during $1.3124
.
Against a yen, a euro strike a two-month high during 104.04 yen
during one point, and final stood during 103.84 yen, adult 0.2
percent from late U.S. trade on Thursday.
The Australian dollar strike a 6-1/2 month high of 85.48 yen
during one point, and was final changing hands during 85.20
yen, adult 0.4 percent on a day.
Helping support a Aussie dollar were a launches of
Japanese investment trusts, or toushin, targetting investment in
Australian dollar bonds, traders said.
Nomura Asset Management is due to launch dual Aussie bond
funds on Friday with top subscription boundary of 200 billion
yen each. The supports devise to sell Aussie/yen call options to
enhance returns, according to a handbill of a funds.
One premonition is that tangible launch sizes of Japanese
investment trusts mostly tend to be many reduce than their
subscription limits.
BENEFIT OF THE DOUBT
A collection of upbeat U.S. mercantile information on Thursday helped lift
the dollar opposite a yen and helped support risk sentiment.
The series of Americans filing for new stagnation benefits
unexpectedly fell to a nearby four-year low final week, while
factory activity in a Mid-Atlantic area stretched in February.
The strength of a U.S. liberation suggests U.S. yields could
head aloft and assistance support ceiling movement in dollar/yen in
the nearby term, though a some-more essential cause is a BOJ’s monetary
policy, pronounced Credit Suisse’s Farris.
“What will eventually be many critical is either a BOJ,
over a subsequent several months, continues to behind up, to convince
the markets around a actions that something unequivocally has altered in
this change in denunciation on inflation,” Farris said.
A concentration will be either a BOJ, for example, continues to
expand a distance of a item shopping intrigue if it judges that
inflation expectations are not relocating enough, he said.
“Right now a marketplace is giving them a bit of advantage of the
doubt,” Farris said, adding that a miss of a bearish
steepening in Japanese supervision holds this week suggests that
it still has some convincing to do.
“It will substantially take some time and some bid from the
BOJ to build credit on a ability to grasp this idea of
1 percent inflation,” he said, adding that Credit Suisse now
sees a dollar during 80 yen in three-months’ time and 83 yen in 12
months.
