Dollar flat against yen in Asia as Japanese exporters sell, importers buy

The dollar was little changed against the yen in Asia Wednesday as selling by Japanese exporters offset the buying of Japanese importers.

The U.S. unit initially rose to 104.97 yen on buying by Japanese importers and Asian short-term players covering short positions. As it approached 105, however, Japanese exporters began selling and pushed the dollar back to 104.76 yen by midafternoon compared with 104.79 yen late Tuesday in New York.

Following slightly better-than-expected U.S. economic indicators last week, support for the dollar has been growing, "but it may not be enough to boost it up much further," said Akio Shimizu, head of foreign exchange trading at Mitsubishi UFJ Trust and Banking.

"Players have been buying back the dollar after having oversold it before, but the data is not so strong as to actually cause active buying above 105 yen," Shimizu said.

The euro slipped a tad against both the U.S. and Japanese currencies as market participants prepared for the European Central Bank's interest rate decision due Thursday. Against the dollar the euro stood at US$1.5506 midafternoon in Tokyo; again the yen it was at 162.39.

While market participants widely expect the central bank to stand pat, players will be watching for any change in tone from ECB President Jean-Claude Trichet that could hint of rate cut possibilities later this year.

The dollar was higher against other Asian currencies, trading 1.1 percent higher against the Korean won at 1,025.1 and 0.12 percent higher against the Philippine peso at 42.37.