Hong Kong, Aug. 1 (BridgeNews) - The U.S. dollar weakened against most currencies in the Asian morning trade Wednesday, but no fresh news was behind the fall in the currency. After rising to an intraday high of 125.21, the dollar eased against the yen to 124.80 as exporter selling triggered some downward pressure from the topside. The greenback also fell against the euro on U.S. investment bank buying.
The dollar initially fell against the yen from 125.10 to 124.80 on Australian dollar/yen selling, but bounced to 125.20 on dollar/yen and euro/yen buying from European and U.S. names.
It later fell to 124.80 after finding Japanese exporter selling near the week's high of 125.37 and euro/yen selling at the recent high of 109.80.
Options-related selling was expected to limit the downside, with large options rumored to be expiring at the 125.00 level on Friday. Euro/yen kept a firm tone in the morning trade. The cross moved in a tight 109.41-85 trading range as of 1200 JT amid lack of fresh major market leads.
Japanese stock market had little impact on the currency market. Shares rallied after gains on Wall Street overnight. Electrical appliance shares were mostly higher despite the disappointing quarterly earnings outcome announced by Matsushita Electric Industrial Monday. The Nikkei 225 Stock Average rose a mere 49.30 points, or 0.4%, to 11,910.07.
Nihon Keizai Shimbun reported that Japanese Prime Minister Junichiro Koizumi has directed the state minister for administrative and regulatory reform to target a cut of 1 trillion yen in subsidies to semi-governmental corporations in the fiscal 2002-03 (April-March) budget allocation guidelines to be drawn up by the Finance Ministry by Aug. 10.
The major business daily also reported that former Bank of Japan policy board member Susumu Taketomi said he favors a moderately weak yen that reflected economic fundamentals and that current levels were about right.
The foreign exchange market shrugged off the reports.
In other currency trading, euro/dollar rallied from 0.8760 to 0.8795 as of 1200 JT on U.S. investment bank buying.