* Dollar up against yen on Japan fin. minister comments
* Dollar edges lower against euro on dovish Fed stance
* Ruble up against dollar for first time in four sessions
(Updates with fresh quotes, prices)
By Sam Forgione
NEW YORK, April 16 The dollar rose to the
highest level in a week against the yen on Wednesday on signs of
future buying of Tokyo stocks by Japan's state pension fund, but
edged lower against the euro on traders' view that the Federal
Reserve is maintaining a dovish stance.
The dollar rose against the yen after Japan's Finance
Minister, Taro Aso, promised that "moves" by the $1.26-trillion
government pension fund would become apparent from June, which
helped boost the Nikkei stock index 3 percent.
"The fact that it's the finance minister discussing it and
that a timeline has been put on it- June is not very far
away-both of those (facts) are significant," said Shahab
Jalinoos, currency strategist at UBS in Stamford, Connecticut.
The inverse relationship between the Nikkei share index and
the yen is well established. Foreign players traditionally sell
the yen to hedge the currency risk in buying Japanese shares
while a stronger Nikkei typically makes Japanese investors more
comfortable with investing abroad, also negative for the yen.
The dollar's slight dip against the euro, meanwhile, was the
first in four trading sessions. The dollar fell slightly against
the euro ahead of Federal Reserve Chair Janet Yellen's comments
before the Economic Club of New York after traders braced for
more dovish comments from Yellen.
Yellen said the U.S. economy appeared to be slowly moving
toward full employment, but that it would need help from the
central bank for some time to come, which fulfilled the dovish
stance traders had anticipated.
"The markets were anticipating continued dovish comments
from Janet Yellen, and they were not disappointed," said Joseph
Trevisani, chief market strategist at WorldWideMarkets in
Woodcliff Lake, New Jersey.
Traders had expected that Yellen would not deviate
significantly from the tone of the latest Fed policy meeting
minutes released last week and comments she made on March 31
that the central bank's "extraordinary" commitment to boosting
the economy would be needed for some time.
Economic data, meanwhile, did little to support the dollar
against the euro. U.S. factory production increased 0.5 percent
in March, according to data from the Fed on Wednesday, marking a
sign of recovery from a long winter that had put a damper on
The Commerce Department, however, said U.S. housing starts
increased 2.8 percent to a seasonally adjusted annual rate of
946,000, while economists polled by Reuters had expected starts
to rise to a 973,000-unit rate last month. The data somewhat
offset the positive manufacturing data.
"The impact of the data was less significant," said Jalinoos
Traders said the impact of European Central Bank
policymakers' hints on implementing further monetary easing
continued to wear thin on Wednesday, which also helped the euro
recover gain slightly against the dollar.
The dollar fell against the Russian ruble, meanwhile, for
the first time in four trading sessions. Ukrainian forces
launched a "special operation" on Tuesday against separatist
militia in the Russian-speaking East, authorities said.
"The Ukrainians have finally acted," said Trevisani of
WorldWideMarkets. He said the ruble likely gained some ground
against the dollar on Ukraine's attempt to forestall separatist
actions in Ukraine.
The euro was last up 0.02 percent against the dollar
at $1.3816. The U.S. dollar index was last up 0.03
percent. The dollar was up 0.33 percent against the Japanese yen
at 102.27. The dollar was also up 0.23 percent against
the Swiss franc to trade at 0.882 francs.
The dollar was last down 0.72 percent against the ruble
to trade at 35.99 rubles.
(Additional reporting by Patrick Graham in London; Editing by
Meredith Mazzilli and David Gregorio)