US dollar rallies in Asia on hedge fund buys

US dollar rallies in Asia on hedge fund buys

TOKYO - The dollar staged an afternoon rally in Asian trading on Tuesday as hedge fund purchases helped push up the unit.

The dollar fetched 99.96 yen from 99.69 yen in New York on Monday, while the euro was at $1.3251 from $1.3254.

The European single currency strengthened to 132.48 yen from 132.10 yen in US trading.

"There have been large buying orders of the euro/yen pair by hedge funds," said a senior dealer at a major bank in Japan.

"That's helping push up the dollar/yen" rate.

The dealer added that the dollar-yen rate could push higher as risk appetite grows after Tokyo's successful bid to host the 2020 Olympics as well as Moscow's proposal on Syria raising the possibility of a US military strike being delayed or shelved.

Earlier in the session, the dollar faced selling pressure partly driven by weak US jobs data.

The figures last week threw into question the timeline for the US Federal Reserve to start pulling back on its huge stimulus drive, known as quantitative easing.

All eyes are on the central bank's policy meeting next week for signs of a draw down on the scheme. A pull back would likely push the dollar's value higher.

"The USD may be helped by a relatively firm US retail sales reading expected at the end of the week but tapering uncertainty will likely act to restrain any topside," Credit Agricole said.

Yen trading has been dominated by data on Monday showing Japan's economy grew more than expected in April-June.

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