Dollar Rises Againt Yen, Euro After FOMC

 
   By Hiroyuki Kachi 
 

        The dollar was a tad higher against the yen and the euro during Asian trade Thursday, encouraged by what investors interpreted as a slightly hawkish statement from the Federal Open Market Committee in deciding when to raise short term rates.
        The greenback advanced to Y124.19, its highest since July 21, before paring earlier gains to Y124.10 at around 0450 GMT. That compared with Y123.94 late Wednesday in New York. The U.S. currency also strengthened against the euro, which fell to $1.0972 midday from $1.0986 in New York overnight.
        The WSJ Dollar Index, a measure of the dollar against a basket of major currencies, was up 0.06% at 88.46.
        The U.S. dollar tracked the overnight firm tone that followed the Federal Reserve's statement after a two-day policy setting meeting. The stock market's solid performance in Asia also encouraged market sentiment to help the dollar ratchet up in the morning session before stabilizing just above the Y124-line.
        The Fed on Wednesday left its benchmark short-term interest rate near zero, but dropped several hints that it is close to seeing enough improvement in the job market to prompt officials to raise the rate as early as September.
        For months, Fed officials have said they wanted to see "additional improvement in the labor market" before being convinced it is time to raise rates. In Wednesday's statement they said they wanted to see "some" additional improvement, suggesting they see themselves nearing their threshold on the jobs front for action.
        "They didn't say it clearly but investors can slightly smell (a rate increase) in September," said Koji Fukaya, chief executive at FPG Securities.
        But Mizuho Bank chief market economist Daisuke Karakama continues to expect a December hike. The Fed policy setting members didn't provide hints of raising rates that means they need to keep intact basic stance of "data dependency" ahead of closely-watched jobs data scheduled twice ahead of the next FOMC scheduled Sept. 16-17.
        "Expectations for a rate raise are so faint, you can blow them away," he said.
        The Shanghai Composite was last trading down 0.04%. Meanwhile, Japan's Nikkei Stock Average was up 1.1% at midday.
        In other currency trades, the euro was at Y136.16 midday from Y136.17 overnight.
        Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com
        (END) Dow Jones Newswires

        July 30, 2015 01:24 ET (05:24 GMT)

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