* Yen dips versus dollar, more losses expected
* G20 meeting seen unlikely to criticise BOJ policy
* Euro retreats from 7-week high versus dollar
* Swedish crown falls as Riksbank lowers rate forecasts
LONDON, April 17 The yen fell against the dollar
on Wednesday, with traders seeing little chance that Japan's G20
peers will make a significant stand against aggressive monetary
easing that has hammered the currency.
The euro retreated, puling away from a seven-week high
against the dollar, with traders citing a media report where a
former European Central Bank board member voiced concerns about
the euro's gains.
They said there were worries this may reflect the views of
some ECB policymakers who are concerned about weak economic
The dollar was up 0.2 percent against the yen at 97.75 yen
, although it remained below the four-year high of 99.95
yen set last week.
Markets await a Group of Twenty meeting beginning on
Thursday for signs of how deeply the United States and other
leading economies will question Japan's policy on the basis of
the yen weakness it implies.
But recent comments from officials so far have suggested
that the group as a whole will not criticise the policy on the
grounds that it is motivated by domestic economic concerns.
"The pullback in dollar/yen is probably now complete and we
look for it to pull higher ... It should break 100 fairly
quickly," said Ian Stannard, head of European currency strategy
at Morgan Stanley.
"The IMF and G20 appear very supportive of Japanese policy
Many analysts believe that the abundance of global liquidity
due to monetary easing in Japan and the United States will also
lead to further weakness in the yen as Japanese domestic
investors look to use it to buy overseas assets that give them
"I don't think there will be any criticism (by the G20)
especially now after the correction lower in dollar/yen," said
Marcus Hettinger, global FX strategist at Credit Suisse. He
expected the dollar to hit 102 yen within the next three months.
The dollar was also helped as gold prices steadied after a
hefty plunge on Monday. The drop in gold, triggered partly by
concerns about slowing growth in China, had lifted the yen,
which is often sought in times of financial uncertainty.
The euro cut its gains, however, to last trade down 0.25
percent at 128.18 yen after a media report cited
former member of the ECB Executive Board Lorenzo Bini Smaghi
saying the central bank should find ways to stop the euro from
Traders also reported selling of the euro against the yen by
hedge funds. The single currency is now some way off a
three-year peak of 131.10 yen hit last week and was also 0.3
percent lower against the dollar at $1.3127,
pulling away from a seven-week high of $1.3202 hit on Tuesday.
Elsewhere, the Swedish crown fell after the Riksbank, the
country's central bank, held interest rates as expected but
delayed plans for tighter policy well into next year.
This lifted the euro to a one-and-a-half month
high around 8.4750 crowns.
"The Riksbank usually makes smaller changes to the rate
path," said Richard Falkenhall, currency strategist at SEB in
Stockholm, adding that the rate path changes caught the market
But he said SEB forecast the euro at 8.0 crowns in 12
months, based on an improving Swedish economy and expectations
aggressive monetary easing elsewhere will boost flows into
countries with strong fundamentals, including Sweden.