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Euro softens in Asia after Greece gains

Euro softens in Asia after Greece gainsTOKYO: The euro lost early gains in Asia on Friday after getting a boost from progress in the Greek debt crisis, while the dollar rose against most Asian currencies as investors bet on a US rate hike this year.

In Tokyo afternoon trade, the single currency fetched $ 1.0974 and 135.99 yen, down from $ 1.0985 and 136.10 yen in New York.

The dollar was trading at 123.92 yen, slightly up from 123.90 yen.

Spirits were dampened by a report showing Chinese manufacturing activity tumbled in July, adding to concerns about the world’s number two economy.

The euro had edged up in morning trade as Greece’s creditors prepared to head to Athens Friday for talks on a new bailout. Greek lawmakers approved this week a second round of austerity measures demanded to unlock 86 billion euros in much-needed support.

The greenback got a boost as initial claims for US unemployment insurance benefits fell to their lowest level in nearly 42 years last week, in another sign of tightening in the country’s jobs market and reinforcing expectations for a rate hike before 2016.

“Dollar buying has been advancing on expectations of a Fed rate hike,” Shinji Kureda, head of forex trading at Sumitomo Mitsui Banking, told Bloomberg News.

The increasing likelihood the Fed will move this year have sent the dollar up other Asian currencies. It hit a six-year high of 34.90 Thai baht Friday.

It is at a two-year-high 1,167.87 South Korean won and a five-year high of 45.51 Philippine pesos.

The US currency also bought 63.91 Indian rupees, compared with 63.65 rupees Thursday, and rose to 13,465 Indonesian rupiah from 13,416 rupiah.

It was at Sg$ 1.3725 from Sg$ 1.3670, and Tw$ 31.42 against Tw$ 31.23.

The Australian dollar dropped to 72.95 US cents, down from 73.81 cents, while the Chinese yuan rose to 19.96 yen from 19.94 yen.

Copyright AFP (Agence France-Presse), 2015

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