By Hiroyuki Kachi
The dollar regained some ground against its peers such as the yen and euro in Asian trade on Friday, with short covering kicking in after Thursday's heavy selling.
At around 0550 GMT, the U.S. currency was trading at Y115.99, compared with Y115.34 late Thursday in New York. The euro weakened to $1.0577 from $1.0608 late Thursday.
The greenback hit a fresh three-week low of Y115.06 early in the morning trade but bounced to briefly break above the Y116 level before spending the rest of the session hovering just below the Y116 line.
The dollar's gain came after Thursday's rout, in which investors seemed to have offloaded their bets on a higher dollarafter dovish minutes from the Federal Reserve. That marked a partial reversal of the currency's strengthening since Donald Trump's victory in the U.S. presidential elections in early November.
Investors largely sat on the sidelines ahead of the closely-monitored U.S. jobs report for December slated later Friday.
"Ahead the U.S. jobs data today, investors are taking a wait-and-see stance," thus limiting the upward momentum, said IG Securities market analyst Junichi Ishikawa. "Investors are avoiding making major moves until they see the jobs data," said Mr. Ishikawa.
"I got impression that [the dollar's] downswing to around Y110 can't be ruled out," given the rapid pace of the dollar's decline recently, said Osamu Takashima, chief FX strategist at Citigroup Global Markets Japan.
But the entire market mood is to take on more riskier assets, as indicated in the pickup in emerging markets and resource-related currencies such as the Aussie dollar. "We are not in an environment to see one-sided yen strength," he said.
Over the longer term, another risk factor is whether President-elect Donald Trump will intensify his protectionist stance, following his remarks opposing Toyota Motor's proposed plant construction in Mexico and threats to impose a tariff on imported Corolla cars.
"That's negative for the U.S. economy," disrupting efficient corporate management and international supply networking, IG's Mr. Ishikawa said.
In other currency trades, the euro was at Y122.68 from Y122.38 late Thursday.
Interbank Foreign Exchange Rates At 00:50 EST / 0550 GMT
Latest Previous %Chg Daily Daily %Chg
Dollar Rates Close High Low 12/31
USD/JPY Japan 115.99-6.00 115.35-36 +0.55 116.13 115.08 -0.86
EUR/USD Euro 1.0575-78 1.0605-08 -0.28 1.0613 1.0576 +0.54
GBP/USD U.K. 1.2374-76 1.2418-20 -0.35 1.2430 1.2374 +0.24
USD/CHF Switzerland 1.0120-24 1.0095-99 +0.25 1.0123 1.0094 -0.66
USD/CAD Canada 1.3260-65 1.3223-28 +0.28 1.3264 1.3224 -1.33
AUD/USD Australia 0.7315-19 0.7335-39 -0.27 0.7352 0.7314 +1.60
NZD/USD New Zealand 0.7012-18 0.7022-28 -0.14 0.7043 0.7004 +1.30
EUR/JPY Japan 122.68-72 122.34-38 +0.28 122.83 122.15 -0.32
Source: Tullett Prebon
Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com
(END) Dow Jones Newswires
January 06, 2017 01:08 ET (06:08 GMT)
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