TOKYO, June 28 (AFP): The dollar was mixed in narrow ranges in Asian trade Wednesday with many players taking to the sidelines on the eve of an expected US interest rate rise, dealers said.
They said the yen remained weak against other major currencies amid increasing pressure on the governor of the Japanese central bank who has been embroiled in controversy over his investment in a scandal-tainted fund.
The dollar slipped to 116.18 yen in Tokyo afternoon trade from 116.26 in New York late Tuesday, when it earlier hit a two- month high of 116.70.
The euro inched down to 1.2577 dollars from 1.2582 and dropped to 146.06 yen from 146.31. In London trade Tuesday, the euro had risen to 146.64 yen, the highest level since the unit was born in 1999.
Another quarter-point rate hike from the Federal Reserve on Thursday to 5.25 percent has been factored in and investors are waiting for hints from the US central bank on the outlook on possible rate hikes beyond this month.
"The forex market saw range trading as players were hesitant to take a position ahead of the Fed meeting," said Satoshi Okagawa, head of the forex trading group at Sumitomo Mitsui Banking Corporation.
"The dollar remained firm, helped by market speculation of interest rate increases while investors await the accompanying (Fed) statement," he added.
Yoshihiro Nomura, forex team manager at Trust and Custody Services Bank, said the US currency may face profit-taking after the Fed meeting, even if the statement signals another rate hike at its next meeting in August.
"The market has largely priced in rate hikes in both June and August (so) the dollar may slip in a 'sell the fact' movement even if the statement is hawkish," he added.
The yen was weighed down by concerns over a fresh call on Bank of Japan governor Toshihiko Fukui to resign for his investment in the fund of Yoshiaki Murakami, who has been indicted for alleged insider trading.
The dollar fell to 957.3 South Korean won from 958.5 on Tuesday, to 9,356 Indonesian rupiah from 9,383 and to 1.5960 Singapore dollars from 1.5967.
The US currency rose to 32.651 Taiwan dollars from 32.645 and to 53.505 Philippine pesos from 53.425 while holding steady at 38.435 Thai baht.