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Dollar slips in Tokyo

as energy fizzles out

TOKYO: The dollar was lower in late Tokyo trade after a morning that saw a brief surge to within a touch of Monday's high for this year. But gains were soon erased by U.S. funds' selling, and afternoon trade was limp as a dearth of fresh factors inhibited trade.

"We've gone back to that same old range-bound market," one city bank dealer said.

Recent weeks had seen the currency market stuck fast to narrow ranges.

By late Tokyo the greenback was stuck between bids from U.S. funds around 107.40 yen and offers from Japanese exporters at 107.70 yen, 107.75 yen and 107.80 yen.

Dealers said Tuesday's trade was a bit of natural position adjustment after Monday's sudden leap to 107.70 yen, a new high for the year as well as the highest level for the greenback since around February 1994.

But activity was muted, with the day's high of 107.68 yen hit in early trade, after which the dollar slid slowly down.

U.S. funds were the initial sellers after the greenback's early rise, giving way to Japanese exporter offers in the afternoon.

By contrast, the U.S. funds were likely to have begun buying on dips, along with some Japanese operators.

"There seems to be a consensus among Tokyo operators that the 107.20-107.30 yen level is a buy for the dollar," said Manabu Nakagawa, chief dealer at the Bank of Nova Scotia in Tokyo.

With new factors scarce on the horizon, attention turned to Friday's release of March U.S. jobs data, dealers said.

February's payrolls data was surprisingly strong, sending U.S. bonds plummeting and setting the greenback up for a brief rise.

A Reuters poll of economists yielded an average forecast of a rise in non-farm payrolls of 60,000, with a range from flat numbers to a gain of 100,000 jobs. The unemployment rate is seen rising to 5.6 percent from 5.5 percent in February.

Trading in the mark-linked arena was quiet, with the dollar unable to rise on the mark in the face of offers from German corporations at around 1.4850 marks and up. But no real losses were seen, as few dealers currently hold dollar-long positions.

The mark barely moved against the yen, with bids at 72.45 yen and offers at 72.55 yen.

In Singapore, dealers said the dollar was drifting slowly lower against the yen and the mark.

One dealer with a European bank in Singapore said the dollar was likely to be capped at 1.4850 marks and 107.70 yen, with support at 107.10/20 yen and 1.4780 marks.-Reuter