By Masataka Nakamura
Tokyo, Aug.30 (BridgeNews) U.S. dollar/yen eased ground in sluggish trading. The market lacked follow-through movement of the dollar/yen, after a recovery in the last New York session. Option players, exporters and profit takers sold the pair on tops. Meanwhile, euro/dollar trading was listless ahead of the European Central Bank meeting. Early in the session, dollar/yen lost ground, as Japanese exporter sold the pair through the Tokyo fixing.
The market reacted little to jawboning from Japanese Vice Finance Minister for International Affairs Haruhiko Kuroda who said a strong yen is neither good nor desirable, and the European single currency should strengthen further.
Dollar/yen selling pressures from exporters, profit takers and option players, weighed on the pair through the end of the Asian session, while the market conditions were thin. Yasuji Yamanaka, deputy general manager of treasury department at Nikko Trust Banking said that market participants were taking a stance of "sell on top", after a rise in the New York session.
Overall, trading conditions remained sluggish, with fewer numbers of participants involved in the market.
Dealers pointed out that good amounts of options with the strike price of 120.00 will expire Thursday and Friday, which was discouraging the momentum of the pair in either direction.
Euro/yen eased ground, largely shadowed by a fall in the dollar/yen. In addition, dealers expect the pair to remain heavy above the 109.30 area.
The following news did not affect the price movement of the dollar/yen, though they attracted some attention from dealers. Toyota Motor President Fujio Cho said dollar/yen in a range between 110 and 120 would be desirable, indicating the current foreign exchange level would be acceptable for major exporters despite some jawboning from Japanese economic officials.
Bank of Japan Governor Masaru Hayami repeated recent comments that it is desirable for foreign exchange rates to be stable, reflecting economic fundamentals.
He said the recent weakness of the greenback is due to the slowing of the U.S. economy.
Japan's seasonally adjusted industrial and mining production fell 2.8% in July from June, which was worse than private economists' average outlook of a 2.1% fall.
The Nikkei 225 Stock Average fell 41.31 points, or 0.38%, to 10,938.45 spurred by Wall Street's losses in the face of upwardly revised U.S. gross domestic product data, as well as weaker-than-expected Japanese industrial output data.
In other currency trading, euro/dollar settled around 0.9075, amidst some lingering hopes of European Central Bank easing at Thursday's board meeting.
This followed an early fall from 0.9083 to 0.9060 on position squaring selling early in Sydney trading.
Yamanaka at Nikko Trust & Banking said that traders were not willing to open new positions ahead of the ECB meeting, which made trading rather listless.