The euro rose against the dollar in Tokyo Tuesday as investors bought the currency on expectations the Group of Seven (G7) might intervene jointly to support it, a dealer said.
The European single currency bought $0.8595-98 at 5:00 pm (0800 GMT), up from $0.8580 in New York but down from $0.8645-48 in Tokyo late Monday.
”The head of Britain's central bank, Eddie George, had reportedly said he did not rule out the possibility of joint intervention by the G7 to support the euro," said Sanwa Bank dealer Mitsuru Sahara.
Finance ministers and central bank governors from the seven industrialized nations were due to meet in Paris later in the day.
"Investors bought the euro on expectations of joint intervention," Sahara said.
While the euro's slide has slowed down on the back of possible intervention by the European Central Bank, the single European currency has failed to capitalize on the weakness in US stock markets.
Singapore's research institute IDEAglobal.com said this suggested "traders still lack conviction to hold the euro."
"On balance, the euro/dollar outlook remains range bound with a slight upward bias," it said.
Against the yen, however, the euro was quoted at 92.62, down from 93.22 in Tokyo late Monday.
"Investors who had bought the euro in overseas markets on the expectation of moves to support the currency sold the euro when it didn't come," Sahara said.
Meanwhile, the dollar bought 107.72-75 yen at 5:00 pm, up from 107.61 yen in New York, but down from 107.82-85 yen in Tokyo late Monday.
"Since investors also expect Japan to participate in the joint intervention by buying the euro and selling the yen, the yen was weaker against the dollar," Sahara said.
In late Singapore trade, the US dollar fell to 49.9 Philippine pesos from 50.3, 43.645 Thai baht from 43.71 and 1,134.48 South Korean won from 1,138.05.
The greenback rose to 9,340.00 Indonesian rupiah from 9,220.00, 32.168 Taiwan dollars from 32.160 and 1.7427 Singapore dollars from 1.7422.— (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)