Dollar rise due to china depreciated currency, and the eurozone debt situation. (photo: Reuters)
The dollar edged up against other major currencies in Asia on Monday as investors awaited a raft of economic data and a meeting of the US central bank later this week, analysts said.The Euro fall because of the european debt state, and the Chinese inflation rate forced the goverment to increase interset rate, which puts pressure on its budget
The dollar changed hands at 84.08 yen in Tokyo afternoon trade, slightly up from 83.94 in New York late Friday.
The euro fell to 1.3194 dollars from 1.3226, and to 110.94 yen from 111.02 yen amid persistent worries over eurozone sovereign debt.
Trading was calm in the absence of fresh market-moving news.
The yen is likely to weaken due to expected further monetary tightening by China, Citibank's Japan forex chief strategist Osamu Takashima told Dow Jones Newswires.
"With higher interest rates, the cost for China to maintain its vast foreign currency reserves will increase," he said.
Dealers are tipping Beijing to increase rates after data on Saturday showed inflation at 5.1 percent in November, well up from October's 4.4 percent and much higher than the government's three percent comfort zone.
To offset such a cost China is likely to prefer investing in higher-yielding assets such as those denominated in the Australian dollar and New Zealand dollar, he said.
"It's highly unlikely that low-yielding yen-denominated assets will be a major investment vehicle for China."
A string of economic data is due out this week, including US consumer prices and the Bank of Japan's quarterly business sentiment survey on Wednesday.
The US Federal Reserve's policy-setting Open Market Committee is to hold a meeting on Tuesday.
A statement from the US central bank, which will come early Wednesday in Asia, is "the most likely candidate to provide the next cue" for the dollar, said John Kyriakopoulos, forex strategist at National Australia Bank.
The dollar was mixed against other Asian currencies.
It eased to 1.3085 Singapore dollars from 1.3096 on Friday, to 43.67 Philippine pesos from 43.72, and to 30.03 Thai baht from 30.05.
It firmed to 1,144.90 South Korean won from 1,142.50 and to 9,018.00 Indonesian rupiah from 9,016.00 while staying flat at 30.04 Taiwan dollars.
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