Dollar inches up as traders watch for fresh clues

17/08/2015 09:57 AST

The dollar inched up against the yen and the euro in directionless Asian trade Monday, given fewer participants amid the summer holiday and a lack of fresh trading cues.

The greenback USDJPY, +0.07% was at ¥124.38 from ¥124.30 late Friday in New York. The U.S. currency was also stronger against the euro EURUSD, -0.0990% which was down slightly at $1.1087 midday from $1.1110.

The WSJ Dollar Index BUXX, +0.08% , a measure of the dollar against a basket of major currencies, was up 0.07% at 88.65.

With eased tension after a volatile week following the China’s decision to devalue its tightly controlled currency, investors are shifting their focus again to U.S. economic indicators.

The dollar gained along with the Nikkei Stock Average NIK, +0.49% , which was higher after a solid stock performance in the U.S. Friday. The benchmark Nikkei was up 0.2% midday

But the dollar was straightjacketed in a tight range with a lack of fresh trading cues throughout the session.

“There are fewer number of market participants,” due to summer holiday season, said IG Securities market analyst Junichi Ishikawa.

“I think the dollar will continue to remain rangebound,” until U.S. data and the release of the Federal Open Market Committee minutes later this week gives the currency market some motion.

Investors await such data as housing starts for July due Tuesday and the consumer price index for July scheduled on Wednesday to gauge if the Federal Reserve is closer to its decision to raise short-term interest rates, which some say could be as soon as September.

Until the data is released later this week, the dollar will likely remain in an extremely tight ¥124.00-¥124.50 range, said Ishikawa.

Investors shrugged off Japan’s gross domestic product data, which contracted in the second quarter as households spent less and demand for Japanese goods overseas slumped.

Japan’s GDP shrank 1.6% on an annualized basis in the April-June quarter, according to data released on Monday by the Cabinet Office. That compared with a 1.9% contraction forecast by a survey of economists by The Wall Street Journal.

In other currency trade, the euro EURJPY, -0.04% was at ¥137.91 from ¥138.15.

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