Brocker.Org: Dollar/yen off five-month low but US-Japan trade challenges limit rise – Reuters

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By Shinichi Saoshiro
| TOKYO

TOKYO The dollar pulled away from five-month lows as opposed to the yen on Tuesday, with responses from U.S. Treasury Secretary Steven Mnuchin and greater personal debt yields supplying the bruised dollar some respiratory place.

Continue to, the dollar was capped by nervousness about Tuesday’s economic dialogue amongst the United States and Japan. Lingering worries about North Korea and the coming French presidential elections also stored a lid on the dollar versus the safe and sound-haven yen.

Mnuchin advised the Economic Periods that he agreed with U.S. President Donald Trump’s perspective that the dollar’s toughness in the shorter time period was hurting exports, but that he observed the currency’s toughness more than the lengthy time period as a optimistic.

Mnuchin’s responses had been found countering those people of the president, who last 7 days mentioned the dollar was way too robust, sending it reeling.

The dollar included to overnight gains and was up .1 % at 109.040 yen immediately after soaring briefly to 109.225. It had sunk to a five-month trough of 108.a hundred thirty earlier on Monday on worries about tensions in the Korean Peninsula.

At the U.S.-Japan economic dialogue, there are issues Washington could consider a tough trade stance versus Tokyo, which has been wary of Trump’s problems that Japan and other nations around the world have artificially weakened their currencies.

“For dollar/yen, the main concentration will be on what kind of stress the United States could implement on Japan as generally U.S. trade policy is linked with a policy for a weaker dollar,” mentioned Junichi Ishikawa, senior forex strategist at IG Securities in Tokyo.

“The yen cannot just continue on weakening along with greater stocks beneath this kind of situations,” he mentioned.

Washington’s standoff with Pyongyang was found incorporating a new dimension to U.S.-Japan economic talks, as the United States has sought support from China in confronting North Korea.

“Trump seems to have created a concession pertaining to China, a critical player in the North Korean problem,” mentioned Makoto Noji, senior strategist at SMBC Nikko Securities, referring to last week’s U.S. Treasury’s semi-annual currency report in which the Trump administration backed away from a critical campaign promise and did not label China a currency manipulator.

“But at the identical time, for the sake of his supporters, Trump has to stick with his pledge to tackle trade imbalances, and this raises the possibility of his administration getting tough with Japan,” Noji mentioned.

The dollar index, measuring it versus a basket of main currencies, was flat at one hundred.290 .DXY immediately after popping up to one hundred.400 earlier in the session.

The euro was a shade greater at $1.0652 EUR=, owning found limited movement on Monday when many European marketplaces had been shut for the Easter vacation.

The Australian dollar dipped .3 % to $.7566 AUD=D4. The Aussie nudged up over $.7600 to a two-7 days substantial on Monday on upbeat Chinese expansion facts. On the other hand, weaker charges of iron ore, Australia’s critical export, have prevented the currency from being over that threshold.

Treasury yields rose from five-month lows on Monday as Wall Avenue shares obtained, lowering demand from customers for safe and sound-haven personal debt. [US/]

(Editing by Richard Borsuk)

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