US dollar, yen weaken as central banks to meet

[NEW YORK] Currency markets were largely stable on Monday, with the dollar and euro weakening modestly against the yen ahead of closely watched meetings this week at the US and Japanese central banks.

Policy makers are due to gather at the US Federal Reserve on Tuesday and Wednesday and the Bank of Japan on Friday.

Both the euro and the dollar had lost ground against the yen by 2100 GMT Monday, with the euro falling to 116.32 yen from 116.55 and the dollar falling to 105.82 yen from 106.19 on Friday.

The euro was up slightly against the dollar, fetching US$1.0993 versus US$1.0976 late Friday.

The British pound rose slightly to US$1.3139 from US$1.3112.

"Come Friday, Japan is expected to lend more monetary support to the world's struggling No three economy," Western Union Business Solutions said in a note on foreign exchange developments.

The yen had sunk to six-week lows as this week's decisions approached, it said.

"Should Japan stop short of meeting markets' high hopes for aggressive action, any move in the yen could be up rather than down."

AFP