Source AP ©

Dollar rises higher against yen as euro reaches record high vs yen

The dollar rose against the yen in Asian trading Thursday as the euro rose to a record high against the Japanese currency.

The dollar bought 119.39 yen midafternoon Thursday, up from 119.34 yen late Wednesday in New York. The euro rose to US$1.3462 from US$1.3430.

The euro rose to 160.85 yen, an all-time high.

"The euro is perfect. There is no doubt about it," said Jun Kato, a senior dealer at Shinkin Central Bank. "The economy won't likely go slow at least for this year."

A range of players including short-term-focused investors and bank dealers bought euros on expectations that the upbeat European economy will prompt another credit tightening by the European Central Bank in the near term.

Players will likely turn their attention to ECB President Jean-Claude Trichet's press conference following the central bank's monetary policy meeting later Thursday. Investors are speculating the ECB will leave its key rate unchanged at 3.75 percent.

During the Asian session the euro rose to as high as $1.3469, its highest level since March 2005.

Kato said most players are betting that European currency officials won't complain about the euro's strength at this weekend's meeting of the Group of Seven (G7) financial heads in Washington, D.C.

That view gathered more support from markets overnight after the International Monetary Fund's top economist Simon Johnson said Japan's monetary policies are "exactly right." The remark confirmed the IMF's view that the Bank of Japan shouldn't rush to raise interest rates.

Against other Asian currencies, the dollar was mostly higher. It rose 0.40 percent against Indian rupee to 42.865 and 0.24 percent against Indonesian rupiah to 9,104.