Dollar Stays Near 15-year Low Versus Yen
The dollar barely budged versus other major currencies on Wednesday in the absence of first-tier economic data from the United States.
While industry data hinted at continued weakness in the housing market, traders took to the sidelines wanting more clues about the general direction of the global economy.
The Mortgage Bankers Association said refinancing activity increased 17.1 percent from the previous week, the biggest jump since May 2009. However, the MBA’s seasonally adjusted purchase index decreased 3.4 percent from one week earlier.
A successful bond auction in Germany further eased fears about Europe’s sovereign debt problems.
The buck held just above its 15-year lows versus the yen amid growing speculation that Japanese officials will intervene to prevent the yen from rising much further.
The export-driven Japanese economy was nearly stagnant in the second quarter as traders flocked to the yen due its appeal as a safe haven. A strong yen makes Japanese goods more expensive to foreigners.
The buck continued its run of choppy trading versus the euro, holding between 1.2850 and 1.2900 for most of the day.
Against the yen, the buck was stuck near 85.50, hovering above its recent 15-year low of 84.71.
The dollar leveled off to 1.5650 against the sterling after hitting a 3-week high of 1.5497 overnight.
The minutes of the latest Bank of England policy making meeting painted a relatively rosy picture of the region’s economy.
Voting members of the Bank of England were not unanimous in holding interest rate at a historic low in August, the minutes of the meeting showed. The vote was 8-1, with Andrew Sentance remaining the lone voice in the wilderness calling for rate hike.
The buck failed to rally versus the loonie after seeing recent losses. The buck touched a weekly low of C$1.0271 in early dealing.
The triple-A sovereign ratings of France, Germany, the U.S. and the U.K. are well positioned, despite the fiscal challenges, rating agency Moody’s reportedly said Tuesday.
