Friday, 28 August 2015 10:06
TOKYO: The dollar rose against the yen Friday after upbeat US growth data suggested the world’s top economy was weathering a slowdown in China, ahead of a key Federal Reserve summit of central bankers.
In Tokyo morning trading, the dollar bought 121.08 yen, up from 121.02 yen in New York and sharply higher than the 119.98 yen a day earlier.
The euro was stronger at $ 1.1256 against $ 1.1239 in US trade, while it rose to 136.29 yen from 136.03 yen.
Sentiment got a boost after the Commerce Department reported Thursday that the US economy grew at an annual rate of 3.7 percent in the second quarter, much higher than the 2.3 percent initially estimated.
The strong figures come amid uncertainty over the timeline for a Fed interest rate hike, as market turmoil and fears about China have dealt a blow to expectations for a rise as early as next month.
Central bankers and other top experts from around the world are headed to Jackson Hole, Wyoming, for the annual Fed symposium.
“With some stability in China expected this week, and good data, the chatter at JH (Jackson Hole) is going to get just that bit more interesting,” National Australia Bank said in a commentary.
Investors were closely monitoring the pow-wow for insight on when the Fed would begin raising its zero-level federal funds rate. A rate increase generally lifts the dollar as investors seek higher returns.
“The Fed will desperately try to raise rates in 2015, but they’d certainly like to see stability in equity markets before they do,” Derek Mumford, director at Rochford Capital in Sydney, told Bloomberg News.
