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REFILE-FOREX-Euro supported as U.S. mulls Russian plan on Syria
September 10, 2013 / 12:36 AM / 4 years ago

REFILE-FOREX-Euro supported as U.S. mulls Russian plan on Syria

* Dollar remains under pressure with Fed policy outlook unclear

* Aussie supported by upbeat China trade data

By Lisa Twaronite

TOKYO, Sept 10 (Reuters) - The euro held steady around a more than one-week high in early Asian trade on Tuesday, as risk appetite ticked up after a Russian proposal on Syria raised the chance that a U.S. military strike would be delayed or averted.

President Barack Obama said Russia’s proposal to put Syria’s chemical weapons under international control “could potentially be a significant breakthrough.”

If Syria did so, that would “absolutely” put any U.S. military strike on pause, Obama told ABC News.

The dollar also remained under pressure after last week’s disappointing U.S. jobs data increased uncertainty about whether the U.S. Federal Reserve will begin to taper its stimulus program this month.

“We’re definitely in a holding pattern, with the Syria story and the Fed story,” said Bart Wakabayashi, head of forex at State Street Global Markets in Tokyo.

“There has been some good flows into the dollar recently, so there was some unwinding of that,” he added.

The euro was steady from late U.S. trading at $1.3253 , after rising to $1.3280 on Monday, its highest since Aug. 29, according to Reuters data.

The single currency faces resistance at $1.3278, a level that is roughly 50 percent of the move from its Aug. 20 high of $1.3452 to last Friday’s low of $1.3103.

The dollar index, which tracks the greenback against a basket of six currencies, was slightly higher at 81.841, off a more than one-week low of 89.617 touched on Monday.

Against its Japanese counterpart, the dollar gained back some lost ground, adding about 0.1 percent to 99.68 yen but still well shy of Friday’s high of 100.22 yen.

Minutes of the Bank of Japan’s August policy-setting meeting released on Tuesday showed many members believed the central bank’s massive government bond purchases are restraining long-term interest rates even as overseas bond yields rise and Japan’s business conditions improve.

The Australia dollar was up about 0.1 percent at $0.9232 after rising as high as $0.9241 in the previous session, its highest since July 29, and following last week’s gains of more than 3 percent.

Data released over the weekend showing China’s August exports grew more than expected added to evidence that the economy of Australia’s major trading partner remains on solid footing, which underpinned the Aussie.

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