TOKYO (AFP) – The euro rebounded modestly in Asia on Wednesday after it dropped in New York on reports that the European Central Bank could expand its bond-buying programme.
In Tokyo afternoon trade, the common currency fetched $1.2723 and 136.15 yen against $1.2714 and 136.04 yen in US trading on Tuesday. The single currency had been at $1.2800 and 136.86 yen the previous day.
The dollar edged up to 107.02 yen from 106.99 yen, after fresh data Tuesday showed US existing-home sales rebounded in September from a dip in August to their highest pace of the year.
Investors will be looking to US inflation figures later in the day after a series of uneven data has thrown into question the strength of the world’s top economy, ahead of the US Federal Reserve’s policy meeting next week.
“The US CPI (consumer price index) is at the forefront of attention,” Ayako Sera, head of research team at Sumitomo Mitsui Trust Bank, told Dow Jones Newswires.
Late Tuesday, reports that the European Central Bank was considering buying riskier corporate bonds on the secondary market, perhaps as early as next year, pushed down the euro against the dollar and the yen.
If it happens early next year as some reports suggest, the ECB move could further push down long-term interest rates in the eurozone, which would tend to weaken the currency by denting demand for euro-denominated assets.