Dollar stuck near 102 yen line amid few trading clues

Tokyo (June 24)   The U.S. dollar traded narrowly near the  102 yen  line in  Tokyo  on Tuesday as market players found few fresh trading clues.

At  5 p.m.  , the dollar fetched  101.96-98 yen  compared with  101.88-98 yen  in  New York  and  101.87-88 yen  in  Tokyo  at  5 p.m. Monday  . It moved between  101.81 yen  and  102.02 yen  during the day, changing hands most frequently at  101.84 yen  .

The euro was quoted at  $1.3605-3607  and  138.72-76 yen  against  $1.3599-3609  and  138.63-73 yen  in  New York  and  $1.3591-3592  and  138.46-50 yen  in  Tokyo  late Monday afternoon.

After drifting in a tight range in overseas trading overnight, the dollar continued to trade without clear direction in  Tokyo  .

Traders were awaiting the Japanese Cabinet's approval of a new economic growth strategy scheduled for the early evening, dealers said.

Since a draft of the strategy was already released earlier this month, a sharp market reaction was viewed as unlikely but market players were keen to see how it has been fleshed out, with attention on a corporate tax cut as well as pension and labor market reforms, dealers said.

"Volatility in the dollar-yen exchange rate remains very low," said  Minori Uchida  , head of  Tokyo  global market research at  Bank of Tokyo-Mitsubishi UFJ  .

"Unless U.S. Treasury yields rise at a gradual pace, it would be difficult to expect the dollar to rise" beyond its recent boxed range around  102 yen  , he said.

Compared with the new economic growth strategy, upcoming economic data, including U.S. price data on personal consumption expenditures in May, due out Thursday, and Japanese consumer prices, also for May and due out Friday, are expected to play a greater role in determining the near-term outlook for the dollar-yen exchange rate, said  Shinichiro Kadota  , foreign exchange strategist at  Barclays Bank  .

"If the (Japanese) data show a rapid acceleration of inflation, it will further undermine expectations for additional monetary easing by the BOJ and pressure the dollar versus the yen," he said, adding the upcoming U.S. price data could also provide hints as to when the Federal Reserve will start raising interest rates.

Source: KyodoNews