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Dollar Falls Against Yen In Asia As Trade Issues At Forefront

1/24/2018, 10:57:59 AMMarket Analysis
Dollar Falls Against Yen In Asia As Trade Issues At Forefront

The dollar fell against the yen in early Asia on Tuesday as pressure on the greenback grows following trade action by the US against China and South Korea and concerns over the what kind of trade message the Trump administration will give at Davos.

Japan reported trade figures for December with the trade balance at a surplus of ¥359 billion, narrower than the ¥530 billion surplus seen. Imports jumped 14.9%, above the 12.3% gain seen, while exports rose 9.3%, less than the 10.1% pace seen.

USD/JPY changed hands at 110.18, down 0.14%, while AUD/USD traded at 0.8000, down 0.01%.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted at 89.88, down 0.30%.

Overnight, the dollar rose from lows but remained under pressure as the yen made strong gains shrugging off less hawkish than expected comments from the Bank of Japan following its decision to keep monetary policy unchanged.

In what was a quiet day on the calendar for the top-tier US economic data, the dollar struggled to find its footing after falling to fresh three-and-a-half month lows before paring some of its losses.

The euro continued its trend higher against the greenback as data indicating underlying strength in the US economy, added to the growing speculation that bullish Eurozone growth would force the ECB to consider plans to end its quantitative easing program.

The ECB is slated to meet on Thursday, when many expect the central bank to keep rates unchanged while ECB president Mario Draghi is likely to downplay any investor expectations that the central bank will soon announce plans to adopt a less dovish stance on monetary policy.