TOKYO Oct 25 Asian shares edged up on Friday
and the dollar was hemmed in near a two-year low against the
euro on expectations the U.S. Federal Reserve would maintain its
massive monetary stimulus into 2014.
MSCI's broadest index of Asia-Pacific shares outside Japan
added 0.2 percent. The index fell 0.1 percent on
Thursday as rising Chinese money-market rates countered signs of
a pick-up in manufacturing in the world's second-largest
In Tokyo, Nikkei futures fell 0.4 percent, signalling a
softer opening for the benchmark.
U.S. S&P E-mini futures were flat in early trade
after the S&P 500 index had advanced 0.3 percent on solid
earnings and expectations that monetary stimulus will be in
place for the foreseeable future after weak data.
U.S. manufacturing output fell for the first time in four
years and the number of new claims for unemployment benefits
fell less than expected last week.
The euro was steady at $1.3798, not far from a
two-year high of $1.3826 touched on Thursday and shrugging off
data showing the pace of growth in euro zone business
unexpectedly eased this month.
"The dollar will not rally without Fed tapering expectations
rising again, but we would not chase EUR/USD higher here, as
rate compression suggests the pair is unlikely to break much
higher," Societe Generale analysts wrote in a note, saying they
favoured Scandinavian and Antipodean currencies into year-end.
"Fed tapering expectations being pushed out into 2014 and
further ECB easing early next year suggest a favourable policy
environment for the FX carry trade. Throw in lower volatility
and seasonality effects, and one has the perfect cocktail for
the carry trade."
The Australian dollar held steady at $0.9618, about
one cent below a 4-1/2 month high of $0.9709 on Wednesday.
Against the yen, the dollar stood at 97.37 yen, a
stone's throw from a two-week low of 97.15 yen hit on Wednesday.
Gold paused for breath after climbing 1.1 percent on
Thursday, while U.S. crude prices added 0.1 percent to
about $97.2 a barrel, moving away from a 3-1/2 month low of
$95.95 touched in the previous session.