30 January 2007, 16:52  The yen stayed near a 4-year low against the dollar

The yen stayed near a 4-year low against the dollar on Tuesday as soft Japanese economic data raised further doubts about whether the Bank of Japan will lift interest rates next month. The greenback was supported before a two-day U.S. Federal Reserve policy meeting starts later in the day, with investors looking for clues in any post-meeting statement on Wednesday about whether the U.S. central bank has become more optimistic on the economy after a raft of strong data. "The dollar/yen focus is still very much an interest rate story, with people taking out (expectations of) U.S. rate declines and also removing some Japanese rate (hike) expectations in the short term," said Adrian Schmidt, currency strategist at RBS Financial Markets. However some investors were reluctant to push the Japanese currency to new lows ahead of a Feb. 9-10 meeting of Group of Seven finance ministers and central bankers which could yield some comments against the yen's weakness.

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