The US dollar was knocked down again in Asia, after an early recovery attempt was halted when the yen jumped on data showing an unexpected increase in industrial production in October. After yet another sharp dollar sell-off in New York overnight, the dollar started the Asian session weak against the euro but was showing some signs of a recovery on the Japanese unit. That was abruptly halted when Japan released the industrial output data, which moved against expectations, gaining a preliminary 1.6 pct from September against the consensus call of a 0.4 pct drop, the trade ministry said. The October output, which followed a 0.7 pct decrease in September, was also a reversal of the 0.2 pct drop manufacturers surveyed by the ministry had expected previously. "The Japanese industrial production surprised the market and sent dollar-yen falling from 116.25," said a dealer in Asia. Some analysts were also of the view that the yen's gains overnight had lagged those of the euro and other major currencies given the extent of the dollar's retreat, resulting in some players having to play catch-up. "Going forward, the case continues to build for a further rate hike and these industrial production data add to that case," said one market analyst. "In my opinion, the BOJ is more likely to hike in Q1 2007 than December this year." Dollar-yen marked a morning low of 115.62 yen and then traded between there and 115.88 through the rest of the morning and into the afternoon, as the market lost interest in trying to lift the dollar back up above 116.00. "The 115.40-50 zone is now critical for the yen; the pair hasn't been below (that) since August," noted a dealer at UBS AG. Dollar-yen's morning slide also mirrored euro-yen's sharp reversal this morning after the cross marked yet another lifetime high of 153.45. The ensuing tumble which followed the industrial output data release saw the cross slide below 153.00, to 152.52. Afternoon trade saw the cross shuffle between 152.62 and 152.88.