Dollar falls in Asia over weak US data

Dollar falls in Asia over weak US data
TOKYO: The dollar fell in Asian trade Friday amid a broad selling of the greenback following weak US economic indicators, despite growing concerns over a possible Greek debt default, dealers said.

The euro rose to $1.4191 and 115.03 yen in Tokyo morning trade from $1.4141 and 114.96 yen in New York Thursday.

The dollar fell to 81.04 yen from 81.29 yen.

The US unit dipped late Thursday following an report showing US jobless claims last week headed higher after two weeks of declines.

Washington also left unrevised its estimate of first-quarter economic growth at a tepid 1.8 percent. Most analysts had expected a rise to 2.0 percent.

Daisaku Ueno, chief analyst at Gaitame.Com Research Institute, said dealers see no further deterioration in sentiment for the euro after Jean-Claude Juncker, who heads the eurozone finance ministers, suggested the IMF may withhold its payment next month on Greece's bailout.

Juncker said the fifth tranche in a 110-billion-euro loan package could be hampered by IMF rules forbidding the lender of last resort to release funds without a 12-month guarantee of solvency.

Japan on Friday reported a rise in core consumer prices for the first time in more than two years, mainly as a result of an increase in fuel prices, but the economic data were largely ignored by forex dealers.

The core consumer price index, which excludes volatile food prices, rose 0.6 percent in April from a year earlier, the first increase since December 2008. The upturn was in line with market expectations.

But the April rise is unlikely to signal an end to Japan's long-standing deflationary problems as it stems mainly from higher costs for oil products because of increased import prices and supply problems.

Japan's massive earthquake and tsunami in March damaged oil refineries and disrupted distribution of petrol, kerosene and other petroleum products.

Asian shares edge up but Tokyo hit by CPI data

Asian shares edge up but Tokyo hit by CPI data
HONG KONG: Asian shares were mostly higher Friday but Tokyo edged down after data showed consumer prices rose for the first time in
28 months in April due to higher fuel prices following the March 11 disaster.

Hong Kong opened 0.12 percent higher, Sydney gained 0.43 percent, Seoul rose 0.86 percent and Shanghai added 0.18 percent.

Tokyo's Nikkei slipped 0.24 percent by the break after the government released figures showing prices rose 0.6 percent year on year last month, the first increase since December 2008.

Dealers sold up as the data, which excludes volatile food prices, pointed to a jump in costs for oil products due to higher import prices and supply problems. Analysts said the jump does not indicate an end to the country's deflationary woes.

"The CPI uptick came mostly from higher materials costs being passed on to consumers rather than an increase in demand," and that could hurt consumer spending, Hideyuki Ishiguro, a strategist at Okasan Securities, told Dow Jones Newswires.

The Japanese market was also weighed by a slightly stronger yen.

In early Asian trade the dollar fetched 81.22 yen, down from 81.29 in New York late Thursday and well off the 82.00 a day earlier.

The euro bought 114.99 yen, down from 115.06 in New York while it edged down to $1.4135 from $1.4141 in New York.

The euro remained under pressure amid concerns that Greece could default on its debt repayments as Athens warned that it would go bankrupt without the next tranche of a multi-billion-dollar bailout.

However, the International Monetary Fund has said it will not allow the cash to be released unless Greece provides "assurances" on how the country will fund its future.

The US currency was slightly weaker after worse-than-expected figures raised concerns over the world's biggest economy.

The Labor Department announced that jobless claims headed higher after two weeks of declines, while the government also left unrevised its estimate of first-quarter economic growth at 1.8 percent.

Most analysts had expected a rise to 2.0 percent.

Despite the disappointing figures the Dow Jones Industrial Average eked out a small gain of 0.07 percent on Thursday.

On oil markets New York's main contract, light sweet crude for July delivery gained 29 cents to $100.52 a barrel and Brent North Sea crude for July was 20 cents higher at $115.25.

Gold opened in Hong Kong at $1,523.00-$1,524.00 per ounce, up from Wednesday's close of $1,525.00-$1,526.00.

KSE-100 index gains 27.40 points

KSE-100 index gains 27.40 points
KARACHI: Stocks extended gains on Friday amid hopes that the government will announce the removal of a capital gains tax in the upcoming 2011/12 budget, dealers said.

The 2011/12 (July-June) budget is due to be unveiled on June 3.

According to media reports, the government may decide to remove the capital gains tax. A 10 percent capital gains tax is imposed on stocks held for six months or less and 7.5 percent on stocks held between 6 months to a year.

Officials from the finance ministry have declined to comment.

"There is a feeling in the market that the capital gains tax will be removed, and this is helping the sentiment," said Mohammed Sohail, chief executive of brokers Topline Securities.

"This hope is likely to keep the market positive in the sessions ahead of the budget, and if indeed the tax is removed, it should result in increased activity in the market," he said.

The Karachi Stock Exchange's (KSE) benchmark 100-share index ended 0.22 percent, or 27.40 points, higher at 12,225.22 on turnover of 79.64 million shares.

In the currency market, the rupee eased 85.65/75 to the dollar from 85.57/a day earlier, amid slightly higher dollar demand from importers.

The rupee hit a record low of 86.50 on Monday and dealers said the local unit may face pressure amid increased demand for dollar for import payments and a bleak outlook.

"There are some import payments next week, so the dollar demand would rise and the rupee will see some pressure," said a dealer at a foreign bank.

There are also concerns about the growing tensions with the West, which could choke off much needed foreign aid.

The rupee has lost more than 1.25 percent of its value since then, almost the same as its total loss of 1.53 percent in 2010.

In the money market, overnight rates edges slightly lower and closed at around 13.50 percent, compared with the previous day's close of 13.90 percent.