TOKYO, Oct 25: The dollar continued a steady advance against the yen on Thursday on prospects of a rebound in the US economy and fears of a further intervention by the Bank of Japan to weaken the Japanese unit, traders said.

The greenback was quoted at 123.09-11 yen against 122.85 yen in New York and 122.51-53 yen in Tokyo late Wednesday.

There have not been many economic factors but on the technical side, the dollar had broken through resistance levels, said Koji Fukaya, chief foreign exchange analyst at Bank of Tokyo-Mitsubishi.

Now the market is looking forward to 125 yen to the dollar, maybe by next month or December, before the year-end, he said.

Dollar gains were aided by Japanese investors who bought four trillion yen in foreign bonds in the four weeks from September 4, to October 2, Fukaya said.

Interest in foreign bonds stemmed from fears of Japanese intervention in foreign exchange markets to keep the yen weak and expectations of a rebound in the US economy, he said.

It’s keeping investors positive about the US market, and for dollar-denominated assets, Fukaya said.

Japan’s Ministry of Finance repeatedly intervened in the currency markets through the central Bank of Japan following last month’s terrorist attacks, to stem the yen’s gains against the dollar.

Royal Bank of Scotland head of foreign exchange sales Kosuke Hanao said there was little activity in the market, other than some short-term options-linked trade.

Traders are waiting for economic indicators out of the US next week, led by consumer confidence data next Tuesday, followed by the National Association of Purchasing Management index Thursday and US unemployment data Friday, Fukaya from Tokyo-Mitsubishi said.

The euro was rangebound ahead of a meeting of the European Central Bank to set interest rates later Thursday.

The euro bought $0.8911-13 compared with $0.8938 in New York and $0.8914-16 in Tokyo late Wednesday.

Against the yen, the euro was quoted at 109.71, compared with 109.80 in New York and 109.23 in Tokyo Wednesday afternoon.

The euro was quiet and rangebound, said a dealer with BNP Paribas in Singapore.

In late Singapore trade, the dollar fell to 51.83 Philippine pesos from 51.95 pesos the previous day and 34.5440 Taiwan dollars from 34.5455.

The greenback rose to 44.90 Thai baht from 44.78, 10,225 Indonesian rupiah from 10,205, 1.8273 Singapore dollars from 1.8255 and 1,297.00 South Korean won from 1,296.05.—AFP