TOKYO, April 14: The dollar marked time against other major currencies in Asian trade Friday as support from strong US retail data subsided and activity wound down for the Easter holiday outside Japan, dealers said.
The dollar rose to 118.60 yen in Tokyo afternoon trade from 118.54 in New York late Thursday.
The euro was at $1.2112 after 1.2108 while firming to 143.61 yen from 143.47.
In overseas trade, the US currency rose to as high as 118.85 yen after 10-year US Treasury bond yields climbed above 5.0 per cent for the first time in four years on the back of strong US retail sales and consumer sentiment data.
US retail sales increased 0.6 per cent in March, beating the consensus forecast for a 0.5 per cent rise.
A consumer sentiment index rose to 89.2 in April from 88.9 the previous month, just shy of the consensus forecast of 89.3.
Trade was muted with markets shut in the United States until Monday and in Europe through Tuesday.
Osamu Takashima, chief analyst at the Bank of Tokyo-Mitsubishi UFJ, said investors were was now waiting for more US data.
Also they are watching for the meeting of US President George W. Bush and President Hu Jintao (of China), he said.
China announced a limited relaxation of its forex controls Friday ahead of Hu’s trip under which qualified banks will be allowed to pool capital from institutions and individuals and buy “certain amounts” of foreign exchange for investment in fixed-income assets overseas.
Domestic fund management firms and securities companies are also permitted to invest institutions’ and individuals’ foreign exchange, again in “certain amounts,” in foreign securities, including stock markets, the Chinese central bank said.
Washington will release a series of economic indicators next week including foreign purchases of US securities and the producer and consumer price indices.
The US Federal Reserve will also release minutes from its March interest rate meeting when it hiked rates as expected by 0.25 points to 4.75 per cent.
For now the US currency could struggle to make further gains.
The dollar will remain top-heavy due to lingering concerns over an eventual end of the zero interest rate policy in Japan and uncertainty over prospects for the Chinese yuan, Mizuho Corporate Bank dealer Tatsuro Karitani said.
Markets were closed in Australia, Hong Kong, Singapore, Thailand, Indonesia, the Philippines and India for the Easter holiday.—AFP
