Dollar hovers narrowly in mid-102 yen range after Yellen's testimony

February 12, 2014

Tokyo-Japan (Feb 12) The U.S. dollar hovered in the mid-102 yen zone Wednesday in Tokyo amid a lack of trading incentives after the new U.S. Federal Reserve chief Janet Yellen signaled overnight that there would be no immediate changes to U.S. monetary policy.

At 5 p.m. , the dollar fetched 102.50-51 yen compared with 102.58-68 yen in New York at 5 p.m. Tuesday . It moved between 102.42 yen and 102.68 yen during the day, changing hands most frequently at 102.52 yen .

The euro was quoted at $1.3631-3632 and 139.72-76 yen against $1.3634-3644 and 139.94-140.04 yen in New York late Tuesday afternoon.

Tokyo's financial markets were closed Tuesday for a national holiday.

The dollar stayed in a narrow range around 102.50 yen in Tokyo afternoon trading after dropping from its level in New York overnight.

"Market players could not move aggressively as the outlook over the U.S. economy remains unclear," said Masayuki Hoshina , chief economist at Okasan Securities Co.

In New York on Tuesday, the new Fed chair who succeeded Ben Bernanke said in her first congressional testimony that the central bank will keep reducing the scale of its monthly asset purchases.

"Yellen's remarks, which came as expected and offered no surprises, reassured market players as she is likely to adhere to the Fed's policies" under Bernanke, said a senior dealer at a major Japanese bank.

The approval Tuesday by the U.S. House of Representatives of a measure to suspend the U.S. debt ceiling until March 2015 also contributed to the U.S. currency's firmness against the yen, gradually removing a sense of unease among investors, the dealer added.

The Japanese government reported early in the morning that Japan's core private-sector machinery orders fell a seasonally adjusted 15.7 percent in December from the previous month, the largest decline amid comparable data going back to 2005. But the news had only a limited impact on the market.

"From now on, market players are likely to pay attention to Japanese economic data in addition to U.S. data, as they are concerned about Japan's economy after the consumption tax hike in April," said Okasan Securities' Hoshina.

(Source:  Japan Economic Newswire)

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