TOKYO, Oct 25 (AFP) - The dollar was weaker in Asian trade Monday, falling sharply against the yen and the euro on continued concerns over the twin US current account and budget deficits, dealers said.
The dollar fell to 106.73 yen in Tokyo early afternoon from 107.20 yen but was off a six-month low of 106.56 yen hit earlier in the day.
The euro rose to 1.2777 dollars from 1.2680 dollars and to 136.43 yen from 135.92 yen.
"Dollar sentiment is still bearish on concerns about the US current account and fiscal deficits but wariness is also growing over the possibility of intervention," said Soichiro Mori, forex strategist, Himawari Securities.
He was referring to possible intervention by the Japanese authorities to bolster the dollar, thereby keeping the yen weaker in an effort to support exports, which have led the country's economic recovery/
"Overseas players (in Asia) were seen driving the US unit decisively lower in early morning trade," said Masashi Hashimoto, a currency analyst at Bank of Tokyo-Mitsubishi Ltd.
Remarks Friday from a senior official at European Central Bank helped accelerate the dollar sell-off, analysts said. The ECB's Jose Manuel Gonzalez Paramo of Spain reportedly said he is not concerned over the possible impact of a rising euro on the euro-zone economies.
Meanwhile, Hashimoto said he remained skeptical whether the US unit would fall below the 106 yen level in the short term, saying caution ahead of the US elections could weigh on speculators building yen-buying positions.
10/25/2004 03:37 GMT - AFP