The yen extended its declines for the second straight day after a Chinese manufacturing index showed the sector is recovering, lowering investor demand for safe havens.
The yen fell 0.3 percent to trade at 101.64 against the dollar in late-morning trading in New York. The Japanese currency remained slightly unchanged at 138.83 a euro, while the euro fell 0.2 percent to $1.3655.
“We took our direction from the Chinese data overnight,” Adam Cole, the London-based head of Group of 10 currency strategy at Royal Bank of Canada, told Bloomberg. “When it’s risk-on move, generally the yen is the biggest loser.”
The yen also took a hit after MSCI Asia Pacific Index of shares surged 1.2 percent. S&P’s 500 Index rose 0.1 percent on Thursday on top of 0.8 percent advance a day earlier.
The preliminary Markit Economics/HSBC Holdings Chinese manufacturing purchasing managers’ index edged higher to 49.7 this month, the most since December. However, a figure lower than 50 shows contraction.
The dollar rose ahead of today’s forecast that US pre-owned homes surged in April; the first time to do so after the extreme winter weather affected the sales. The Bloomberg Dollar Spot Index, which monitors the dollar against 10 major peers, rose 0.1 percent to 1,010.24.
However, the results showed that sales of existing homes grew 1.3 percent to 4.65 million units, the second time the sales have increased in nine months. However, the figure slightly lagged the economists’ prediction of sales of 4.68 million. Besides the favorable weather, sales were boosted by the fact that more properties were listed on the market and increases in prices fell. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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