LONDON: The dollar was slightly higher against the yen Friday, with investors avoiding taking lopsided positions ahead of the weekend and next week’s Federal Open Market Committee.
The dollar USDJPY, +0.11% were at ¥121.47, compared with ¥121.26 late Thursday in New York.
The euro EURUSD, -0.43%, tumbled to fresh 12-year low during Asian time Thursday. It last traded at $1.0584 from $1.0634.
During Asian trade, the dollar maintained its firm tone against the yen tracking overnight performance in New York, where a stock market rally helped recoup the greenback’s earlier losses caused by downbeat U.S. retail sales data. The Dow Jones Industrial Average DJIA, +1.47% advanced 1.5% Thursday.
Continued strength in the Nikkei Stock Average NIK, +1.39% also gave support to the dollar-yen pair, but the dollar still lacked fresh cues to head higher. The benchmark Nikkei index rose 1.5% to a fresh 15-year high midday.
“The market is not in a mood to rush to buy dollars” against the yen, said Yasuaki Amatatsu, analyst at Bank of Tokyo-Mitsubishi UFJ. Mr. Amatatsu said the dollar’s upside against the yen is now being capped by selling related to commercial trade settlement amid an improvement in Japan’s merchandise trade balance. In addition, repatriation of dividends and other flows ahead of the March 31 book closing of Japanese fiscal year is creating demand for the yen.