TOKYO, Dec 12 (AFP): The yen sank to a record low against the euro in Asian trade today while edging higher against the dollar as the market held its breath ahead of this week's US interest rate decision, dealers said.
The dollar dropped to 120.84 yen in late afternoon Tokyo from 120.99 yen in New York late Friday.
The euro rose to 1.1843 dollars from 1.1807 dollars in New York. The single currency hit a new record high against the yen of 143.18, levels not seen since the euro's launch in January 1999. It later stood at 143.06 yen in late Tokyo deals, compared with 142.55 yen in New York Friday.
A 13th consecutive quarter-point hike Tuesday in the US Federal Funds rate, to 4.25 per cent, is seen as a done deal by the market but investors remain on tenterhooks for the accompanying statement from the central bank.
In particular dealers want to know whether the Federal Open Markets Committee (FOMC) will continue to say that it plans to remove the current accommodative monetary policy at a 'measured' pace.
There are expectations that the difference in interest rates between the eurozone and the US will at some point narrow, and that the difference in interest rates between the eurozone and Japan will widen, dealers said.
Dealers said aside from Tuesday's FOMC meeting, the market's focus is on other data due out this week in the United States as well as the Bank of Japan's quarterly Tankan survey of corporate confidence on Wednesday.
In Singapore trading, the dollar rose to 1,034.3 South Korean won from 1,034 on Friday, 41.30 Thai baht from 41.245, 9,730 Indonesian rupiah from 9,725 and 33.569 Taiwan dollars from
33.498 It fell to 1.6835 Singapore dollars from 1.6838 and 53.5 Philippine pesos from 53.62.