The dollar/yen was stable at lower levels reached earlier in the day on exporter selling and after domestic stocks were bought back up by foreign investors after the recent equity slump, dealers said. The euro remained close to parity, supported at that level by investors protecting stop-loss positions just below. If these positions are broken, the currency is expected to drop sharply. "A lot of foreigners are buying back Japanese stocks, which means they are buying yen. Also some exporters are buying euro-yen," said Hiromi Ookawara, analyst at MCM.
"People are mixed over which currency to sell. The market is offloading dollars. Maybe we will see consolidation for some time," he said, though investors may buy back the dollar somewhat during London trading. "There is not a (strong) preference. There is negative news from euroland one day, such as the German economy, which is in a terrible position, but then another day there is bad news from the US and the market reacts to that." Ookawara said he is concerned over the US economy. "I am bearish on the US economy. There is no effect from the Federal Reserve easing. Fiscal stimulus is the key point," he said. "The US has a higher savings ratio (than previously). Since the attacks last year US consumers are spending less. The last resort for the US economy is household spending," he added. The euro traded close to parity, continuing its weak tone on worries about the economy and speculation of an eventual cut in rates by the European Central Bank, but with the key level held by investors protecting stop-loss positions.///www.ananova.com