* Dollar hits 2 1/2 week high vs yen after data shows
Japan's record trade deficit
* Unrest in Ukraine likely to limit safe-haven yen's losses
* Status quo favours continued range trading for
By Lisa Twaronite
TOKYO, April 21 The dollar firmed in early Asian
trading on Monday, though a tense situation in Ukraine was
likely to keep traders on their toes, with some markets still
closed for the Easter holiday.
The dollar rose to a 2 1/2 week high against the yen after
data showed Japan logged a record trade deficit in the fiscal
year that ended in March. It last bought 102.58 yen, up
about 0.1 percent, after rising as high as 102.63 yen.
The U.S. unit also edged higher against a basket of major
currencies, with the dollar index adding about 0.1
percent to 79.871.
Many markets around the world were closed on Friday ahead of
Easter weekend, and some will remain closed on Monday, meaning
activity is likely to be lighter than usual.
"The greenback's gains are consistent with our caution last
week against playing for a breakout as key support for the
dollar had been approached," Marc Chandler, global head of
currency strategy at Brown Brothers Harriman, said in a note to
"The issue remains the same for the week ahead. Assuming no
exogenous shocks, such data or comments that require a
significant reassessment of the macro-view, that is to say, the
continued status quo favours continued range trading," Chandler
Unrest in the Ukraine added to the yen's safe-haven appeal
and was likely to keep the Japanese currency's losses in check.
At least three people were killed in a gunfight early on
Sunday near a Ukrainian city controlled by pro-Russian
separatists, shaking a fragile international peace accord.
The euro added about 0.2 percent against its Japanese
counterpart to 141.67 yen, moving back toward a
two-week high of 141.77 yen hit on Wednesday.
Against the greenback, the euro was steady at $1.3813
, though still well shy of a 3-1/2-week peak of $1.3906
marked on April 11.
The euro hit a 2-1/2-year high near $1.40 last month,
prompting European Central Bank officials to express their
concern that a strengthening currency could damage the euro
zone's nascent recovery.
In the week ahead, U.S. housing data on Tuesday will likely
confirm that the spring selling season got off to a slow start
last month. Commerce Department data on Wednesday is tipped to
show new home sales little changed, though the durable goods
orders report on Thursday is expected to show a 2.0 percent
increase in overall orders and a 1.5 percent rise in the orders
for core capital goods.
While the outlook for U.S. monetary policy remains key to
the dollar's direction, comments from Federal Reserve officials
will temporarily cease from Tuesday, due to the formal blackout
that prohibits any public communications on policy until the
Friday after the next regular Federal Open Market Committee
meeting taking place April 29-30.
(Editing by Shri Navaratnam)