June 30, 2014
TOKYO (AFP) - The dollar drifted lower in Asia on Monday as a string of disappointing US data last week put pressure on the currency.
The greenback sank to 101.29 yen in midday Tokyo trade from 101.45 yen in New York Friday afternoon.
The US unit briefly fell to 101.23 yen, its lowest since late May.
The euro fetched $1.3644 and 138.24 yen against $1.3646 and 138.45 yen in US trade.
Market reaction was muted after Japanese data showed factory output rose a smaller-than-expected 0.5 percent in May from a month earlier after a 2.8 percent fall in April.
The dollar fell as US Treasury yields fell.
"US interest rates continue to languish on the back of consistent buying of Treasurys, which is keeping the dollar down," Hiroyuki Fukunaga, chief executive at Investrust, told Dow Jones Newswires.
Dreary data on the US economy prompted market players to flee to Treasurys as they sought safe investments but expect the Federal Reserve will keep ultra-low interest rates well into 2015.
On Thursday US consumer spending data for May showed a mere 0.2 percent increase from April, but adjusted for inflation, spending actually fell 0.1 percent.
News of the weakness in consumer spending, the main driver of the US economy, came a day after the government slashed its first-quarter gross domestic product estimate, to a 2.9 percent contraction.
Investors are now waiting for the release of manufacturing data Tuesday, the European Central Bank's monetary policy meeting Thursday and US jobs data on Friday.
"We expect the ECB to leave rates unchanged" at the upcoming meeting, Credit Agricole said in a note. The bank cut rates in June in a bid to fend off deflation as price rises remain minimal.
