Dollar weakens in Asian trade


The dollar was flat in Asia Wednesday following the Bank of Japan’s latest easing measures, while analysts said a superstorm that battered the US could lift President Barack Obama’s re-election chances.
The greenback bought 79.60 yen in Tokyo afternoon trade against 79.61 yen in US trade late Tuesday.
The euro was mixed, fetching $1.2962 and 103.15 yen against $1.2959 and 103.18 yen.
On Tuesday, the BoJ unveiled $138 billion in fresh monetary easing, as it tries to kickstart the world’s third-largest economy which it also warned would grow 1.5 percent in the year to March, much lower than its earlier 2.2 percent forecast.
Policymakers expanded an asset-purchase programme — its main policy tool — by 11 trillion yen ($138 billion) to 91 trillion yen, while keeping rates unchanged at between zero and 0.1 percent.
Citibank Japan chief strategist Osamu Takashima told Dow Jones Newswires that the dollar entered a near-term “correction phase” after its recent gains that were driven by speculation for more BoJ easing.
In the United States Hurricane Sandy ripped along the East Coast on Monday and Tuesday, shutting down New York City and Wall Street.
“Indeed, the witticism that, ‘If there is a God, he is a Democrat’ has resonated, with a sense that this natural disaster gifts the president the ability to simply look presidential, improving his re-election chances in the process,” National Australia Bank said.
“This has been reflected in a softer US dollar, albeit helped by some direct support for the euro from fairly well received Italian bond auctions and Spanish Q3 GDP data” it said in a note.
Investors are usually attracted to Republican candidates, who they see as more market-friendly.
In Europe official data Tuesday showed Spain’s economy shrank 0.3 percent quarter on quarter, although that was better than the previous quarter’s 0.4 percent decline.
The dollar was mixed against other Asia-Pacific currencies.
It eased to 1,090.50 South Korean won from 1,091.60 on Tuesday, to Tw$29.23 from Tw$29.25, to 41.22 Philippine pesos from 41.30 pesos, to 30.69 Thai baht from 30.74 baht, and to Sg$1.2207 from Sg$1.2225.
The greenback rose to 9,623 Indonesian rupiah from 9,605 rupiah, while staying flat at 54.18 Indian rupees.
The Australian dollar rose to $1.0375 from $1.0343 and China’s yuan firmed to 12.72 yen from 12.67 yen.