Dollar Flat Against Yen, Euro Ahead of FOMC

 
   By Hiroyuki Kachi 
 

        The dollar was almost unchanged against the yen and the euro during Asian trade Wednesday, with investors avoiding taking strong positions ahead of the outcome from the Federal Open Market Committee meeting during early morning hours in Asia Thursday.
        At around 0450 GMT, the greenback was at Y123.48, compared with Y123.57 late Tuesday in New York. The U.S. currency was almost flat against the euro, which came to $1.1059 midday, compared with $1.1060 overnight.
        The WSJ Dollar Index, a measure of the dollar against a basket of major currencies, was unchanged at 88.12.
        Currency market participants said Asian stock gyrations, particularly in China, remained one of big market movers, especially after Wall Street's gain overnight.
        Another falloff in the Shanghai Composite Index and the Nikkei Stock Index induced buying of the safe-haven yen.
        But investors were largely taking wait-and-see stance ahead of the FOMC's outcome that may shape their view regarding a potential Federal Reserve rate increase as early as in September.
        "There aren't any trading cues in particular given the slight move in China stocks," said Daiwa Securities senior FX strategist Yukio Ishizuki.
        But the dollar remained steady against the yen partly because of a strong appetite among Japanese corporate investors to buy the greenback, as they feel the heat from a recent string of massive outbound M&As by Japanese companies, said Mr. Ishizuki.
        "Some people are paying attention to the FOMC, but I don't expect specific reference (from the FOMC statement) about a rate increase this time," said Mr. Ishizuki, noting that the Federal Reserve probably won't put all of its cards on the table at this stage, avoiding running into an impasse.
        "They don't have to disturb a sleeping child," said Mr. Ishizuki.
        In other currency trades, the euro rose against the yen, reaching at Y136.55 midday from Y136.60 overnight.
        The New Zealand dollar advanced to as high as $0.6740 and Y83.31 before stabilizing at $0.6705 and Y82.78 midday. Investors took comments by Reserve Bank of New Zealand Gov. Graeme Wheeler as not being so dovish, which triggered a covering of short positions.
        Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com
        (END) Dow Jones Newswires

        July 29, 2015 01:22 ET (05:22 GMT)

#FX
#Forex
#SaleForex
#DollarFlat
#AgainstYen
#EuroAhead
#Of_FOMC