TOKYO–The dollar notched up further gains against the yen in Asia on Monday as investors embraced lower oil prices as a plus for the U.S. economy. The euro rose to 148.03 yen from 147.64 yen in U.S. trade, while it ticked up to US$1.2457 against US$1.2443. The dollar briefly topped 119 yen �X its highest in more than seven years �X after OPEC’s decision last week to maintain output levels despite calls for a cut. However, the dollar’s upward momentum may be constrained, said Akira Moroga, manager of forex products group at Aozora Bank.
It seems to ��have failed to jump straight to further upside due to profit-taking,�� Moroga told Dow Jones Newswires. OPEC had not been expected to respond aggressively to a roughly 35 percent drop in oil prices since June, but it did less than many predicted. On Monday a 3.1 percent third-quarter rebound in Japanese capital spending was seen as boding well for upcoming revised economic growth figures. But on the downside, separate data Monday showed China’s manufacturing growth skidded to an eight-month low in November, signaling further pressure on the world’s second-largest economy. Speculation about the European Central Bank’s (ECB) plans to buy sovereign bonds were dampened by a governing council member, who suggested such a move was unlikely ahead of this week’s policy meeting. ��We expect no Sovereign QE (quantitative easing) announcement from the ECB meeting on Thursday but instead a commitment to more easing likely contingent upon further deterioration in the inflation outlook (highly probable given falling oil prices),�� Credit Agricole said in a note. The dollar was firmer against other Asia-Pacific currencies, firming to 32.89 Thai baht from 32.85 baht, to SG$1.3083 from SG$1.3044 and to 44.95 Philippine pesos from 44.90 pesos. It advanced to 1,114.13 South Korean won from 1,107.95 won, to 62.14 Indian rupees from 62.05 rupees, and to 12,273.80 Indonesian rupiah from 12,204.00 rupiah. The Australian dollar fell to 84.45 U.S. cents from 85.06 cents while the Chinese yuan rose to 19.34 yen from 19.30 yen