Asia stocks mostly higher in early trade, after US gains – CNBC
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The Japanese yen weakened further against the dollar in the U.S session. The dollar/yen pair traded at 109.12 as of 8:20 a.m. HK/SIN, compared to the 108 handle during Asian hours on Tuesday.
The move in the dollar/yen pair came after Japanese finance minister Taro Aso hinted at the possibility of an intervention in the currency market to tame the rise in yen.
Reuters reported that Aso told Japanese parliament on Tuesday that though Japan had no plans to manipulate currency moves on a long-term basis to give exporters a boost, the country was ready to intervene if one-sided moves in the yen persisted.
Since the Bank of Japan elected to keep its monetary policy unchanged late last month, shocking markets in the process, the dollar/yen pair had fallen from the 111 handle to the 106 handle before returning to the 108 level earlier this week.
The move in the dollar/yen was due to short covering, said Kathy Lien, managing director of foreign exchange strategy at BK Asset Management.
“While we are surprised that more Japanese officials are trying to talk up the currency at 108-109 than 106-107, this could be a strategic move to give speculators reason to cover their shorts at a time when the dollar/yen was struggling to extend its losses below 106,” she said.
Asia stocks mostly higher in early trade, after US gains – CNBC}