Tokyo, Jan. 9 (Jiji Press)–The dollar is expected to remain under downward pressure next week, with players keeping a lookout for market interventions by Japan to arrest the yen’s advance.<\/p>\n
Japanese monetary authorities are widely expected to continue stepping into the market after successive suspected actions this week, including a massive intervention on Friday that lifted the dollar by more than 2 yen to above 108 yen.<\/p>\n
But with no end in sight to dollar selling by U.S. financial institutions, hedge funds and Japanese exporters, the U.S. currency is likely to remain top-heavy versus the yen and looks poised to test its record lows against the euro, dealers said.<\/p>\n
Currency players and analysts expect the dollar to trade between 105.50 yen and 108.00 yen in the week of Jan. 13-16, against 107.02- 05 yen at 5 p.m. Friday. The Tokyo currency market will be closed Monday for a national holiday.<\/p>\n
Makoto Kojima, executive director at the UBS AG group’s Tokyo branch, pointed out that market attention is now shifting to the Group of Seven finance meeting scheduled for Feb. 6-7 in Florida.<\/p>\n
The Japanese monetary authorities appear set to stem a further fall of the dollar against the yen in the run-up period to the G-7 meeting, but given swelling dollar-short positions, the currency’s downtrend is unlikely to be reversed by the authorities’ successive interventions, Kojima said.<\/p>\n
In the previous G-7 meeting in Dubai in September last year, finance chiefs and central bankers called for “more flexibility in exchange rates,” sparking a welter of dollar selling.<\/p>\n
Major U.S. economic indicators due out next week include the November trade balance, to be released on Wednesday, and December retail sales on Thursday.<\/p>\n
The euro is expected to trade between 1.26 dollars and 1.3 dollars next week, against 1.2720-2723 dollars at 5 p.m. in Tokyo on Friday.<\/p>\n
Toshihiro Azuma, manager at Sumitomo Trust & Banking Co., said the euro may test highs near the 1.30-dollar line before the G-7 meeting.<\/p>\n
Remarks from monetary authorities on exchange rate levels will be watched closely next week, he said.END<\/p>\n","protected":false},"excerpt":{"rendered":"
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