Source AP ©

Dollar rises against yen in Asia - 11 October, 2007

The dollar rose slightly against the yen Thursday in Asia after Japan's central bank kept its key interest rate unchanged.

The U.S. dollar was trading at 117.32 yen at 2:50 p.m.(0550 GMT) Thursday, up from 117.25 yen late Wednesday in New York. The euro rose to US$1.4165 from US$1.4132.

After ending a two-day policy-board meeting, the Bank of Japan's policy board voted 8-1 to keep a key interest rate unchanged at 0.5 percent. The decision was in line with expectations.

Bank officials were expected to remain cautious as they assessed the economic situation in the U.S., where problems in the subprime mortgage market triggered turmoil in global markets in August. The vote was eight to one, marking the fourth straight time the vote wasn't unanimous.

Players were paying attention to BOJ Gov. Toshihiko Fukui's press conference later Thursday. But any gains in the yen may be short-lived since Japanese interest rates are not a main focus among currency players.

"Players will keep watching U.S. stock prices carefully," said Takeshi Tokita, a senior dealer at Mizuho Corporate Bank. "They are still cautious about the U.S. credit market."

The dollar dropped briefly against the yen Thursday after Moody's Investors Service upgraded Japanese government bonds from A1 to A2, but it later recouped its losses.

Against other regional currencies, the dollar was mostly higher, rising to 44.120 Philippine peso from 43.98 the previous day, and to 917.3 South Korean won from 916.3. It fell to 7.7545 Hong Kong dollars from 7.7554, however.