20 September 2002, 09:57  Forex- Yen weak in midafternoon Tokyo on reform worries;supported by exporters

The yen was weak in midafternoon trade ahead of the Economic and Fiscal Policy Council meeting later today, with earlier hopes for radical reforms waning, dealers said.
However, the dollar's gains against the yen were capped by selling by Japanese exporters, they added. The council will meet this evening to discuss anti-deflation measures following the Bank of Japan's surprise move this week to buy shareholdings from major domestic banks.
In addition, it is expected to release a year to March 2003 GDP forecast, slightly higher than the government's existing estimate. Dealers said disagreement between the Cabinet and the banking regulator is likely to stall any hoped-for reforms tonight. "The Cabinet Office and the Financial Services Agency do not share the same opinion. I don't think the council will announce some radical policies tonight, in such a short time," a dealer at a local Japanese bank said.
The yen will continue to trade in a weaker tone against the dollar for the short-term, with a likely range of 121.00-124.00 yen for next week, he said. The euro is seen trading in a 119-122 yen range, also helping to keep the European currency well supported against the dollar, with the longer-term outlook for the dollar threatened by the possibility of a US war with Iraq.
"Once investors start looking at dollar-negative news, it is possible the dollar will encounter downside pressure," the dealer said. ///www.ananova.com

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