Dollar eases in Asia after weak China data

TOKYO- The dollar slipped in Asia on Tuesday as weak Chinese growth data rekindled concerns about the global economy.

In Tokyo afternoon trading, the greenback slipped to 106.59 yen against 106.92 yen in New York.

The euro rose to $1.2810 from $1.2800, while it weakened to 136.54 yen from 136.86 yen in the US.

Traders moved into the yen — seen as a safe-haven currency in times of turmoil or uncertainty — as official data showed China’s gross domestic product expanded 7.3 percent year-on-year in July-September, slumping to a five-year low despite official efforts to shore up growth in the world’s second-largest economy.

The third-quarter figure announced by the National Bureau of Statistics (NBS) was lower than the 7.5 percent expansion in the previous three months, but exceeded the median forecast of 7.2 percent in an AFP survey of 17 economists.

It is the slowest since the 6.6 percent expansion recorded in the first quarter of 2009, in the depths of the global financial crisis.

Investors will now turn their attention to US home sales later in the day and Japanese trade data on tap for Wednesday.

“Any indication of further weakening export growth is likely to come to the benefit of (Bank of Japan) easing expectations,” Credit Agricole said.

“This combined with further improving risk sentiment should keep the yen a sell on rallies.”

The dollar has tumbled in recent weeks on worries about the global economy and fears about the spread of the deadly Ebola virus.

But Taisuke Tanaka, chief forex strategist at Deutsche Bank in Tokyo, said the currency’s slump was likely to be short lived.

“We haven’t changed our view that the dollar-yen (rate) will try to go above 110 within a month or two,” Tanaka said.