* Dollar/yen rises on short-covering
* Sterling edges up after UK house price rise
* Aussie dips vs dollar after RBA minutes
* German ZEW, US data on retail sales, manufacturing awaited
By Satomi Noguchi
TOKYO, Sept 15 (Reuters) - The dollar rose against the yen on
Tuesday, pulling away from a seven-month low on short-covering,
while investors awaited U.S. data this week that could determine
the near-term direction of the greenback.
The Australian dollar dipped after minutes of the Reserve
Bank of Australia's last policy meeting gave little guidance to
markets on when the cash rate would be raised from its record low
of 3 percent. []
But the direction of the U.S. currency was mixed, with the
dollar falling against sterling after British house prices rose
for the first time in more than two years, giving a boost to the
pound.
Market players largely stayed on the sidelines ahead of U.S.
retail sales data for August and the New York Federal Reserve's
"Empire State" manufacturing figures for September due later in
the session.
Traders and analysts said the trend was towards further
declines in the dollar.
"Strong trends remain in place for the euro, Australian and
and kiwi dollar," National Australia Bank said in a note. "Even
dollar/yen has all-round signals to the downside. These signals
only confirm the overall downside risk in place for the U.S.
dollar."
A steady drop in Treasury yields in the past few weeks
surprised many and triggered speculation that the U.S. dollar was
fast becoming the preferred funding currency for carry trades.
But analysts said economic data for August is expected to
show a strong rebound in the economy, and what will matter more
for the market and the dollar's direction may be the economic
picture after the unwinding of stimulus measures.
"Data soon to be released is expected to continue showing
firmness in the economy, but such strength may be only
temporary," said Masaki Fukui, senior market economist for Mizuho
Corporate Bank.
"What the market will be more concerned about are September
numbers for U.S. auto sales or consumer spending to see whether
or not the economy can keep in good shape after the end of the
stimulus measures," Fukui said.
Germany's ZEW sentiment index for September is due at 0900
GMT on Tuesday. Separately, Federal Reserve Chairman Ben Bernanke
speaks at 1400 GMT. Comments from two senior Fed officials on
Monday indicated that economic recovery might be less than
robust. []
The dollar was up 0.2 percent against the yen from late U.S.
trading on Monday at 91.12 yen <JPY=>, having risen as high as
91.23 yen earlier, and pulling away from a seven-month low of
90.18 yen hit on trading platform EBS on Monday.
Traders said the dollar rose against the yen due to
short-covering, and such dollar buying briefly gained momentum
after the dollar rose above the previous day's intraday high near
91.15 yen.
The euro was little changed at $1.4621 <EUR=>, having pulled
back from a 2009 high of $1.4654 hit on EBS on Monday.
The dollar index, which measures the dollar's value against a
basket of currencies, was steady at 76.648 <.DXY>, staying above
a one-year low of 76.457 hit last week.
The dollar dipped as low as 1.0322 Swiss francs <CHF=> on EBS
earlier in the day, its lowest since late July 2008, then cut its
losses to gain 0.1 percent to 1.0352 francs.
Sterling rose 0.3 percent to $1.6639 <GBP=D4> after news that
house prices in England and Wales had risen for the first time in
more than two years.
The Royal Institution of Chartered Surveyors said its
seasonally adjusted balance of surveyors reporting a rise in
prices in the last three months versus those reporting a fall
rose to 10.7 in August, the first positive reading since July
2007. []
The Australian dollar recovered from losses made after the
RBA minutes and stood at $0.8619 <AUD=D4>, little changed on the
day.
JAPAN'S NEW FINANCE MINISTER
A Japanese newspaper report saying incoming Japanese leader
Yukio Hatoyama has picked veteran lawmaker Hirohisa Fujii as
finance minister had little impact on the yen, partly because
Fujii was already seen as a front runner for the post.
Hatoyama will take office as prime minister on Wednesday.
Fujii said in an interview with Reuters earlier this month
that Tokyo should not step into currency markets unless exchange
rates move abnormally, and that a strong yen is good for Japan as
it curbs import costs. []
Daisuke Uno, chief strategist at Sumitomo Mitsui Banking
Corp, said one point to watch is whether Fujii will stick to such
a stance after he becomes finance minister.
"If the yen continues to strengthen there is a good chance it
will eat into exporters' profits. The question is whether it will
be all right for him to just emphasise the merits for imports,"
Uno said.
(Additional reporting by Anirban Nag in Sydney and Masayuki
Kitano in Tokyo; Editing by Chris Gallagher)
