The euro rose to a new all-time high against the yen yesterday in Asia as sentiments continued to weaken on the Japanese currency amid waning hopes that the nation would drop its zero interest-rate policy in the near future.
The euro rose as high as ¥142.74 before it dipped on profit-taking by interbank dealers and other short-term-focused investors, traders said.
Interest rates
Both the euro and the US dollar are benefiting from higher US and European interest rates compared to the near-zero rates in Japan.
Investors also continued to buy the US dollar, which rose as high as ¥121.09 temporarily, on growing optimism about the greenback ahead of next week's US Federal Open Market Committee meeting, traders said.
By midafternoon in Tokyo, the US dollar was trading at ¥120.96, up ¥0.15 from late Monday in New York. On Monday, it rose to a 32-month high of ¥121.40.
"Prospects are still bright for the dollar," said Satoru Ogasawara, currency analyst at Credit Suisse First Boston in Tokyo.
The fact that the G7 ministers showed little concern about the yen's recent decline in their weekend meeting in London has also given currency players confidence to keep offloading yen for US dollars, Ogasawara said.
Holiday season
But demand from Japanese exporters and US hedge funds for yen to settle accounts before they enter the holiday season may put a lid on the US dollar's gains, dealers said.
"Since this is the last week for such flows, players will be eager to take profits," if the US dollar rises toward ¥121.50, said Reiji Omizawa, director of forex and commodities at Deutsche Securities in Tokyo.
The US dollar, meanwhile, hardly moved against the euro in Tokyo, due to a lack of fresh cues to trade on, with the euro rising to US$1.1793 from US$1.1787 late Monday in New York.
The US dollar was mixed against other regional currencies, slipping to 46.160 Indian rupee from 46.265 the previous day, and to 9,915 Indonesia rupiah from 9,960, while edging up to 53.955 Philippine peso from 53.90.
Although Japanese central bank officials have said that interest rates may rise sometime, expectations are low for the move to come in the next few months.
Japan has maintained zero interest rates for several years to spur a recovery after the economy fell into stagnation during the 1990s.
MILITARY BOOST: The procurement was planned after Washington recommended that Taiwan increase its stock of air defense missiles, a defense official said yesterday Taiwan is planning to order an additional four PAC-3 MSE systems and up to 500 missiles in response to an increasing number of missile sites on China’s east coast, a defense official said yesterday. The official, who spoke on condition of anonymity, said that the proposed order would be placed using the defense procurement special budget, adding that about NT$1 trillion (US$32,88 billion) has been allocated for the budget. The proposed acquisition would include launchers, missiles, and a lower tier air and missile defense radar system, they said The procurement was planned after the US military recommended that Taiwan increase
POLITICAL AGENDA: Beijing’s cross-strait Mid-Autumn Festival events are part of a ‘cultural united front’ aimed at promoting unification with Taiwan, academics said Local authorities in China have been inviting Taiwanese to participate in cross-strait Mid-Autumn Festival celebrations centered around ideals of “family and nation,” a move Taiwanese academics said politicizes the holiday to promote the idea of “one family” across the Taiwan Strait. Sources said that China’s Fujian Provincial Government is organizing about 20 cross-strait-themed events in cities including Quanzhou, Nanping, Sanming and Zhangzhou. In Zhangzhou, a festival scheduled for Wednesday is to showcase Minnan-language songs and budaixi (布袋戲) glove puppetry to highlight cultural similarities between Taiwan and the region. Elsewhere, Jiangsu Province is hosting more than 10 similar celebrations in Taizhou, Changzhou, Suzhou,
TWO HEAVYWEIGHTS: Trump and Xi respect each other, are in a unique position to do something great, and they want to do that together, the US envoy to China said The administration of US President Donald Trump has told Chinese President Xi Jinping (習近平) “we don’t want any coercion, but we want [the Taiwan dispute] resolved peacefully,” US ambassador to China David Perdue said in a TV interview on Thursday. Trump “has said very clearly, we are not changing the ‘one China’ policy, we are going to adhere to the Taiwan Relations Act, the three communiques and the ‘six assurances’ that were done under [former US president Ronald] Reagan,” Perdue told Joe Kernen, cohost of CNBC’s Squawk Box. The act, the Three Joint Communiques and the “six assurances” are guidelines for Washington
DEEPENING TIES: The two are boosting cooperation in response to China’s coercive actions and have signed MOUs on search-and-rescue and anti-smuggling efforts Taiwan and Japan are moving to normalize joint coast guard training and considering the inclusion of other allies, the Japanese Yomiuri Shimbun reported yesterday. Both nations’ coast guards in June sent vessels to the seas south of the Sakishima Islands to conduct joint training, the report said, adding that it was the second joint maritime training exercise since the nations severed formal diplomatic ties in September 1972. Japan dispatched the Nagoya Coast Guard’s Mizuho, a 134m, 6,000-tonne patrol vessel which can carry a helicopter, while the Coast Guard Administration (CGA) sent the 126m, 4,000-tonne Yunlin, one of its largest vessels, the report
RSS