The U.S. Dollar Drops in Early Trading in Sydney

The U.S. Dollar continues to fall against major currencies in Asian trading this Friday, following the release of Japanese Consumer Price Index data for the month of February.  On March 28, 2008, at 00:15 GMT in Sydney, the U.S. Dollar traded at 99.54 yen, compared to 99.68 yen late in New York on Thursday, while the Euro traded at $1.5808 compared to $1.5774 in late New York trading.

 

The economic data released in Japan shows that the Consumer Price Index rose 1% compared to that of February 2007.  The increase in the monthly Consumer Price Index, the fifth straight, is attributable to increased fuel and food prices.

 

Analysts do not expect the Bank of Japan to be too concerned about the CPI data, which is the highest in almost 10years.  Rather, analysts expect the Bank of Japan to pay particular attention to the Tankan Report which will be released by the Japanese Central Bank next Tuesday.  This report will shed light on economic activity as well as sentiment.  According to John Noonan of Thompson IFR, investor interest in the market is slowing down because of the month end.  The U.S. Dollar will continue to fall against major currencies as U.S. releases poor economic data.

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