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Monday May 12, 12:37 PM
Dollar edges up in Asian tradeThe dollar posted modest gains in Asian trade on Monday as traders braced for a raft of data that may shed new light on the extent of the US economic slowdown, dealers said. The dollar edged up to 103.13 yen in Tokyo morning trade from 102.82 in New York late Friday.
The dollar gained ground as speculators adjusted positions following heavy selling of the US currency on Friday as traders bet on steady eurozone interest rates and mulled news of a big quarterly loss at US insurance giant AIG. Although market players hope the worst of the credit problems are over "they remain cautious because they know that (economic) fundamentals remain weak," said Kazuhiko Shibata, Tokyo branch manager at Dresdner Bank. A recent rally on world stock markets sparked by easing worries about the credit crunch faltered last week on renewed worries about the fallout from a US housing slump and soaring oil prices. Investors were becoming more risk averse, "reversing the optimism that markets had enjoyed until last week," said Yosuke Hosokawa, head of forex at Chuo Mitsui Trust Bank. Traders were looking ahead of a batch of US economic indicators due this week, including retail sales Tuesday, consumer price inflation on Wednesday and housing starts on Friday. "Markets will be sensitive to the data and can turn either optimistic or gloomy on the outlook depending on the figures," said Shibata at Dresdner. Traders were monitoring crude oil prices, which fell back in Asian trade but were still trading above 125 dollars a barrel.
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