Euro rises in Asia on intervention speculation

Published November 15th, 2000 - 02:00 GMT

The euro gained against other major currencies Wednesday afternoon in Tokyo on speculation that the European Central Bank might intervene to support the European single unit, dealers said. 

 

"Against Australian dollars and New Zealand dollars, the euro has performed strongly earlier in the day," said Yasuji Yamanaka, a foreign exchange manager at Nikko Trust and Banking Co. 

 

"Because the European Central Bank has shown its will to support the euro above $0.8550 level, players started to speculate the central bank might intervene overnight." 

 

The European single unit traded at $0.8587 around 2:00 pm (0500 GMT), up from $0.8577 in New York and $0.8580 in Tokyo late Tuesday. 

 

Against the yen, the euro bought 92.86, up from 92.81 in New York and from 92.62 yen in Tokyo late Tuesday. 

 

Earlier in the day, the euro edged down against the dollar and the yen in Tokyo Wednesday morning as investors bought the US unit following a sharp rise in the Nasdaq index, dealers said. 

 

An official count in Florida showing Republican George Bush leading in the US presidential race is encouraging traders to buy dollars, analysts said. 

 

"Moreover, the dollar is benefiting from more favorable corporate earnings results released in the United States," research institute IDEAglobal.com said in Singapore. 

 

Traders will closely monitor results of a meeting of the interest rate setting Federal Open Market Committee "for signs that the Fed is moving away from a tightening bias," it said. 

 

Singapore's DBS Group Holdings Ltd. said, however, that the Fed was likely to keep interest rates unchanged "so as not to create further jitters to the market" amid the prolonged count in the US presidential election. 

 

The greenback meanwhile bought 108.17-18 yen at 2:00 pm, up slightly from 108.16 yen in New York and from 107.72-75 yen in Tokyo late Tuesday. 

 

"It's not moving because there is no lead as to the dollar-yen trade," Yamanaka said.— (AFP)  

 

© Agence France Presse 2000  

© 2000 Mena Report (www.menareport.com)

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