TOKYO: The dollar drifted lower in Asia on Friday as weak inflation figures and disappointing US corporate results dampened investor sentiment, while the euro was also under pressure on deflation fears.
The greenback bought 104.28 yen in morning Tokyo trade, from 104.37 yen in New York Thursday, and after a Japanese government report described Asia´s number two economy as “recovering” for the first time in six years.
The euro weakened to 141.98 yen from 142.11 yen while it also fetched $1.3613 compared with $1.3615 in US trade.
“It seems that the market is still finding its feet after the turn of year despite data in general pointing to positive growth momentum,” Credit Agricole said.
“While we are of the view that market sentiment will remain healthy in the next months and quarters, evidently this is far from a one way bet,” it added.
On Thursday, the US Department of Labor said weekly unemployment claims fell 2,000 last week, indicating the jobs market is recovering slowly.
The department also said consumer prices rose 0.3 percent in December from November, and core prices — stripping out volatile energy and food prices — were up just 0.1 percent. The yearly rate was 1.5 percent and the core rate 1.7 percent, below the Federal Reserve´s 2.0 percent target.
Wall Street was spooked by poor earnings from a number of big firms. Electronics retailer Best Buy plunged 28.6 percent after saying November-December same-store sales were lower than the previous year´s holiday season.
Citigroup also took a hit with below-forecast earnings while chip giant Intel sank in after-market trade as it said net profit last year fell 13 percent.
However, the dollar won a measure of support from a stronger-than-expected rise in the Philadelphia Fed´s index of manufacturing activity.
Investors will be eyeing a string of US data later in the day, including December housing starts, industrial production and consumer confidence.