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Euro mixed in Asian trade

August 27, 2012

Euros — File Photo
Euros — File Photo

TOKYO: The euro was mixed in Asian trade on Monday amid renewed uncertainty over the eurozone debt crisis, as markets turn their focus to a speech by the US central bank chief later this week.

The European common currency bought $1.2507 and 98.48 yen in Tokyo afternoon trade, compared with $1.2512 and 98.43 yen in New York late Friday.

The dollar bought 78.73 yen against 78.67 yen in US trade.

Dealers said markets looked for concrete steps from the European Central Bank (ECB) to tackle the region's fiscal woes with bank chief Mario Draghi hinting at fresh measures.

There has been rising speculation that the ECB would restart a bond buying programme to tame borrowing rates among troubled eurozone countries, such as Italy and Spain.

But Draghi said details of any ECB measures still had to be worked out with member states amid persistent speculation that eurozone paymaster Germany opposed the measures.

German Chancellor Angela Merkel met with Greek Prime Minister Antonis Samaras on Friday about the terms of aid for debt-hit Athens but “there was no progress as earlier expected”, Hiromichi Shirakawa, analyst at Credit Suisse in Tokyo, said in a note.

On Sunday, Merkel warned that “every day” counts in Greece's efforts to comply with its austerity commitments and safeguard its eurozone membership.

Traders were also looking to a US economic symposium this week where Federal Reserve chief Ben Bernanke was to deliver a speech on Friday as markets look for clues about fresh easing measures for the world's biggest economy.

“The focus this week will be (on) remarks by Bernanke,” Shirakawa said, adding that a suggestion of new measures was a possibility given that “the US economy has yet to show a clear direction when the presidential election is coming up”.

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

It rose to 9,526 Indonesian rupiah from 9,503 rupiah on Friday, to Sg$1.2514 from Sg$1.2488, to 55.58 Indian rupees from 55.41, and to 1,134.45 South Korean won from 1,134.38 won.

The greenback also firmed to 31.26 Thai baht from 31.23 baht and to 42.25 Philippine pesos from 42.15 while staying unchanged at Tw$29.95.

The Australian dollar fell to $1.0391 from $1.0431 while the Chinese yuan bought 12.36 yen against 12.34 yen.