Dollar holds firm on strong US data

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TOKYO: The dollar held steady against other major currencies in Asia on Thursday as upbeat US manufacturing data improved sentiment over the world's largest economy, boosting risk appetite.

The dollar rose to 77.06 yen in Tokyo morning trade from 76.97 yen in New York late Wednesday.

The euro bought $1.4412, almost flat from New York. Against the Japanese currency the euro edged up to 111.06 yen from 110.97.

The dollar got a boost from a better-than-expected gain in US durable goods orders while gold prices collapsed by more than eight percent from a record high hit on Tuesday.

The US Commerce Department said Wednesday new orders for US durable goods rebounded 4.0 percent in July from June, which suggested manufacturing growth could pick up in the coming months.

Analysts said the forex market would not see any major moves until a much-awaited speech by US Federal Reserve chief Ben Bernanke on Friday, expected to reveal whether the Fed will further loosen monetary policy.

"The better US data overnight has lowered expectations of QE (quantitative easing) but allowed some cautious optimism for the US economy," National Australia Bank said in a note.

The yen lost some steam as investors sell the safe-haven currency and adjust up holdings of higher-yielding, risk-sensitive assets, said Minoru Shioiri, chief manager of FX trading at Mitsubishi UFJ Morgan Stanley Securities.

"Today's movement is caused by a continuation of the trend we saw yesterday, with the yen and Swiss franc depreciating, as the price of gold dropped," he told.

The dollar was changing hands at 0.7957 against the Swiss franc, compared with 0.7952 francs in New York. (AFP)

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