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Yen inches up after recent selling spree

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(Globalpost/GlobalPost)

The yen inched up against the dollar in Asia on Wednesday after the recent selling spree fuelled by the Bank of Japan's massive monetary easing last week.

The dollar fetched 99.10 yen in Tokyo afternoon trade against 99.18 yen in New York Tuesday afternoon. The euro stayed almost flat at 129.73 yen and $1.3084.

The dollar briefly fell below 99.00 yen on profit taking and 'safe haven' support amid reports North Korea was readying to fire a missile, but the move has not received any sizeable follow-through, National Australia Bank said.

"Levels above 100 yen continue to look like only a matter of time away," the bank said in a note.

North Korea said Tuesday the Korean peninsula was headed for "thermo-nuclear" war and advised foreigners to consider leaving South Korea.

Yonhap news agency Tuesday cited South Korean intelligence as saying the North had completed preparations for an expected missile test-launch -- possibly to coincide with April 15 celebrations for the birthday of late founder Kim Il-Sung.

Market players were divided over how currency markets would react if North Korea goes ahead with a missile launch.

"If any missile is launched, it could spark yen selling," although it will depend on where any missile launch is directed at, Osao Iizuka, head of FX trading at Sumitomo Mitsui Trust Bank, told Dow Jones Newswires.

On the other hand Junya Tanase, chief forex strategist at JPMorgan in Tokyo, said it was hard to predict the impact of North Korea on the yen but any bad news regarding North Korea could spur buying of the safe-haven currency.

It will probably be tough for the dollar to test the 100-yen mark in Asia on Wednesday, he said.

The dollar was mixed against most other Asia-Pacific currencies.

It fell to 41.13 Philippine pesos from 41.26 pesos on Tuesday, to Sg$1.2378 from Sg$1.2401, to 9,700 Indonesian rupiah from 9,739 rupiah and to Tw$29.99 from Tw$30.05.

The dollar firmed to 1,138.54 South Korean won from 1,137.75 won, to 54.46 Indian rupees from 54.43 rupees and to 28.99 Thai baht from 28.97 baht.

The Australian dollar rose to $1.0504 from $1.0429 while the Chinese yuan edged down to 15.97 yen from 16.00 yen.

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http://www.globalpost.com/dispatch/news/afp/130410/yen-inches-after-recent-selling-spree