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Dollar under pressure in Asia after Fed meeting

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(Globalpost/GlobalPost)

The dollar was under pressure in Asian trade Thursday after the US Federal Reserve opted to keep its easy-money policies in place on the back of lacklustre economic data.

After wrapping up a policy meeting Wednesday, the US central bank said it would keep its $85 billion a month bond-buying programme in place, and left open the door to more purchases if the world's biggest economy slowed under Washington's severe budget cuts.

The Fed policy, known as quantitative easing, is aimed at keeping downward pressure on longer-term interest rates, supporting mortgage and credit markets. Central bank easing tends to put pressure on a national currency.

The dollar slipped to 97.26 yen in afternoon Tokyo trade Thursday from 97.40 yen in New York Wednesday afternoon.

The greenback's rise stalled last week just short of the 100-yen mark which it last hit four years ago, as manufacturing and jobs data painted a worrying picture of the US economy.

Traders are also concerned by official figures showing that eurozone unemployment hit a fresh record of 12.1 percent in March, while ratings agency Moody's downgraded Slovenia by two notches to junk status -- with a negative outlook -- warning it might need a bailout.

The euro also eased in Asia on Thursday to 128.07 yen from 128.37 yen and to $1.3167 from $1.3180 ahead of a policy meeting of the European Central Bank (ECB).

ECB policymakers are to meet Thursday with widespread speculation that they could cut interest rates from current record lows and also unveil new measures to kick-start stymied bank lending.

Markets were also keeping an eye on the state of the Chinese economy after fresh data Wednesday pointed to a slight slowdown in April manufacturing activity.

The dollar was mixed against other major Asian currencies.

The greenback firmed to 1.2334 Singapore dollars from 1.2315 in Asian trade on Wednesday, to 29.39 Thai baht from 29.31, and to 41.19 Philippine pesos from 41.12.

It dropped to 53.73 Indian rupees from 53.80, to 29.52 Taiwan dollars from 29.55, to 1,099.49 South Korean won from 1,101.75, and to 9,730 Indonesian rupiah from 9,732.

The Australian dollar fell to $1.0245 from $1.0365 while the Chinese yuan inched up to 15.78 yen from 15.75 yen.

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http://www.globalpost.com/dispatch/news/afp/130502/dollar-under-pressure-asia-after-fed-meeting