Yen up in Asia as cautious investors eye ECB meeting

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In Tokyo afternoon trading, the greenback weakened to 102.52 yen from 102.74 yen in New York.

TOKYO, June 05, 2014 (AFP) – The yen ticked up in Asia on Thursday as cautious investors bought the unit on the back of weak US jobs data and ahead of the European Central Bank s policy meeting.

In Tokyo afternoon trading, the greenback weakened to 102.52 yen from 102.74 yen in New York, while the euro drifted lower to 139.43 yen from 139.68 yen.

The European single currency bought $1.3600 against $1.3599 with ECB policymakers widely expected to cut the bank s key interest rates and unveil other unconventional measures in a battle against deflation.

In the US on Wednesday, the dollar was initially buoyed by broadly upbeat data. The Institute for Supply Management said activity in the services sector surged in May.

Also, the Federal Reserve s “Beige Book” report said all 12 districts of the country saw increasing economic activity in recent weeks. That compares with April s report, which showed two districts saw a decline in activity.

However, payrolls company ADP said the US private sector created a net 179,000 new jobs in May, its lowest level in four months, renewing the focus on Friday s official jobs report.

“The theme of the market remains one of cautiousness ahead of the important events (and) releases today and tomorrow,” Credit Agricole said, adding that the ADP report “cast a shadow on the optimistic forecasts for Friday s official number”.

It added: “All eyes will be on the ECB with market participants expecting concrete actions after the central bank effectively pre-committed itself in the last meeting and amid another round of downward-surprising inflation numbers.”

After effectively pre-announcing a move last month and carefully priming financial markets for action, the ECB is expected to deliver at its regular monthly policy meeting later Thursday.

A slew of recent economic data — including disappointing growth and slowing inflation — has hardened the case for decisive measures.

Official data Tuesday showed eurozone inflation slowed sharply to 0.5 percent in May, from 0.7 percent in April and far weaker than the ECB s target of just below 2.0 percent.

The dollar was mostly lower against other Asia-Pacific currencies.

It slipped to 1,021.48 South Korean won from 1,026.29 won, to 43.82 Philippine pesos from 43.91 pesos and to Tw$30.03 from Tw$30.05.

It also declined to Sg$1.2573 from Sg$1.2580 and to 59.34 Indian rupees from 59.35, while the US unit rose to 11,889 Indonesian rupiah from 11,876.30 rupiah and to 32.68 Thai baht from 32.67 baht.

The Australian dollar strengthened to 92.83 US cents from 92.66 cents while the Chinese yuan was unchanged at 16.39 yen.

bur/si/pb/pdh

 

AFP
050619 GMT JUN 14

2014-06-05

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