MDH:Euro steady amid hopes China will buy Italian debt
TOKYO (Kyodo) -- The euro remained steady against the U.S. dollar and the yen Tuesday morning in Tokyo as hopes that China may buy Italian debt continued to lend support to the single European currency.
At noon, the euro fetched $1.3677-3678 and 105.35-38 yen against $1.3675-3685 and 105.50-60 yen in New York and $1.3561-3562 and 104.22-26 yen in Tokyo at 5 p.m. Monday.
The dollar changed hands at 77.01-07 versus 77.19-29 yen in New York and 76.85-86 yen in Tokyo late Monday afternoon.
The euro traded narrowly after crawling back from a six-month low against the dollar and a 10-year low against the yen it hit the day before, helped by a media report during New York trading that Italy has sounded China out on purchasing its debt.
The news removed some of the worries about the sovereign debt problems in Europe and prompted traders to pick up the common currency in Tokyo as well, dealers said.
But it may be a while before market players regain their risk appetite, as the region's debt problems will not be solved overnight, said Toru Sasaki, head of Japan rates and foreign exchange research at JPMorgan Chase Bank.
"Given the current situation in Europe, market players cannot yet be at ease, so they may continue to turn to the yen," deemed a safe-haven asset, Sasaki said.
Market participants are now braced for the Italian bond auction to be held later in the day.
The dollar slightly weakened against the yen in the morning amid a dearth of major buying cues in the United States, dealers said.
