July 1, 2003	Tuesday	Rabi-us-Sani 30, 1424

LONDON, June 30: The dollar edged up against the euro and yen on Monday as dealers waited to see whether a looming batch of US data would justify markets’ increased optimism about prospects for the world’s biggest economy.

The single European currency eased to $1.1411 from 1.1430 late on Friday in New York.

The dollar climbed to 120.15 yen from 119.51 on Friday.

The market’s focus was turned to US figures including the Chicago purchasing managers’ index due later Monday, the Institute of Supply Managers’ (ISM) index on Tuesday and monthly labour market figures on Thursday.

Given the extent of dollar appreciation in the last two weeks, an ISM survey and employment report that are in line with expectations will probably not be enough to trigger renewed dollar buying, said Derek Halpenny, analyst at Bank of Tokyo-Mitsubishi.

The optimism that is priced into the dollar at present is also being reflected in the sharp sell-off in global fixed income markets, he added.

Modest losses on Wall Street on Friday were also limiting the scope for further dollar gains, after the Dow Jones industrial average slipped below the 9,000-point mark for the first time in almost three weeks on Friday, analysts said.

We note again that a concerted dollar recovery requires US equity markets to rally in conjunction with rising bond yields, said UBS Warburg strategist Shahab Jalinoos.

The US unit received a boost against the yen after ratings agency Standard and Poor’s affirmed Japan’s AA-minus long-term rating — the weakest of the Group of Seven rich countries — and A1-plus short term local currency ratings, with the outlook remaining negative.

S and P credit analyst Takahira Ogawa said Japan’s sovereign debt rating could be downgraded within two years if deflation, large government debt and massive bad loans at banks continued.

The euro was changing hands at 1.1411 dollars from 1.1430 late on Friday in New York, 137.09 yen (136.60), 0.6937 pounds (0.6925) and 1.5524 Swiss francs (1.5418).

The dollar was being quoted at 120.15 yen (119.51) and 1.3577 Swiss francs (1.3660).

The pound was at 1.6494 dollars (1.6495), 197.62 yen (197.13) and 2.2386 Swiss francs (2.2257).

On the London Bullion Market, the price of an ounce of gold stood at $345.35 from 345.50 on Friday afternoon.

MUMBAI: The Indian rupee ended weaker on Monday, moving away from a near-29-month closing high struck last session and dropping from session highs after state-run banks bought dollars for the central bank, traders said.

The rupee ended at 46.4850/4925 per dollar, compared to Friday’s close of 46.395/405, which was its highest close since February 6, 2001.

Traders said the local currency was dealt as high as 46.38 in early trade before state-run banks aggressively bought the greenback.—AFP/Reuters