Euro up after ECB meeting

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Graphic: Renjith Krishnan.

Tokyo - The euro rose against the dollar in Asian trade Friday after the European Central Bank (ECB) chief shrugged off concerns about the unit's surging value as the bank held off fresh policy action.

In Tokyo trade, the single currency strengthened to $1.3409 from $1.3395 in New York on Thursday, while it slightly sagged to 125.23 yen from 125.40 yen.

The dollar slipped to 93.40 yen from 93.61 yen.

After its closely watched policy meeting, the ECB on Thursday left rates unchanged, with President Mario Draghi offering a middling picture of the eurozone economy.

Analysts have said the bank may have to slash rates further if the 17-nation bloc's economy turns weaker this year.

The bank's chief also served up a differing view on the euro's rise after French officials warned over its value, including French President Francois Hollande, who called for possible market intervention to tame the unit.

“The appreciation is in a sense a sign of return of confidence in the euro,” Draghi told reporters on Thursday.

“By and large, both the nominal and real effective exchange rates are on... or about their long term averages... the exchange rate is not a policy target.”

The Bank of England also held steady on monetary policy after its meeting Thursday.

The euro has soared in recent months on easing concerns about the eurozone's prospects and its debt crisis, but the unit's rise has stoked concerns about the stronger currency hurting eurozone exports.

Japan, meanwhile, has been criticised over claims it was engineering a devaluation of the yen, which has fallen steeply in the past few months.

But Tokyo has repeatedly rejected accusations it was manipulating the unit, and risking setting off a global currency war.

The pair barely moved after official data Friday showed the surplus in Japan's current account, the broadest measure of trade with the rest of the world, nearly halved on-year to 4.7 trillion yen ($50 billion) in 2012, the lowest since 1985, as exports to Europe and China slumped.

The dollar was mixed against other Asia-Pacific currencies, firming to Sg$1.2398 from Sg$1.2385 on Thursday, to Tw$29.66 from Tw$29.55 and to 53.52 Indian rupees from 53.30 rupees.

The greenback also rose to 1,093.80 South Korean won from 1,087.90 won, to 29.79 Thai baht from 29.77 baht and 40.68

Philippine pesos from 40.65 pesos while falling to 9,678 Indonesian rupiah from 9,713 rupiah.

The Australian dollar fell to $1.0284 from $1.0329, and China's yuan was almost flat at 14.97 yen. - Sapa-AFP


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