Dollar firm in Asia ahead of G20 talks

Dollar firm in Asia ahead of G20 talks

TOKYO - The dollar held firm in Asian trade Thursday while the yen slipped ahead of the outcome of a Bank of Japan policy meeting and the start of G20 talks where the forex market may top the agenda.

The dollar fetched 93.50 yen in Tokyo midday trade from 93.46 yen in New York Wednesday afternoon.

The euro was also stronger at 125.85 yen and $1.3451 against 125.70 yen and $1.3450 in US trade.

Markets were keeping a close eye on a meeting of finance ministers and central bankers from the Group of 20 industrialised nations that starts in Moscow on Friday.

The talks come after a statement by the Group of Seven richest nations warned over currency manipulation as Tokyo faces accusations it has orchestrated a slide in the yen in recent months. Japanese officials have repeatedly denied the claims.

Japan's Asahi daily, citing a copy of a draft joint statement, reported Thursday that the G20 would also warn members off any competitive currency devaluations.

Fears about such a race to the bottom have stoked talk of a global "currency war" in which rival nations jockey for a trade advantage by driving down their currencies.

The Bank of Japan (BoJ) is to wind up a two-day policy meeting later Thursday but "there is little expectation of any major policy changes," National Australia Bank said in a note.

The bank last month adopted a two-percent inflation target and set out plans for indefinite monetary easing under heavy pressure from Prime Minister Shinzo Abe who took office in December following landslide elections.

BoJ chief Masaaki Shirakawa will step down from his position on March 19, three weeks earlier than planned after he butted heads with Abe on policy matters.

The yen slipped on reports that former BoJ deputy governor Kazumasa Iwata said a dollar-yen rate between 90-100 was appropriate, Dow Jones Newswires reported.

Junichi Ishikawa, market analyst at IG Securities in Tokyo, said any reaction to the comments would be fleeting, with traders' attention stoked because Iwata may be a candidate for the top job at Japan's central bank.

Currency rates hardly moved after official data earlier in the day showed Japan's recession-hit economy shrank in the last quarter of 2012.

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