* Federal Reserve to meet later, weigh more easing
* Nikkei at 7-week high but strong yen worries persist
* Aussie jumps on hawkish RBA minutes
* Gold steady near record high
By Alex Richardson
SINGAPORE, Sept 21 (Reuters) - The dollar hovered near a
five-week low on Tuesday and oil eased as traders positioned
for a Federal Reserve policy meeting later that may discuss
whether the fragile U.S. economy needs a fresh infusion of
cash.
Few market players expect the Fed to make further easing
moves just yet -- and the dollar could gain if that view plays
out -- but it is seen as much more likely that it will signal
its readiness to act if necessary. []
Asian shares edged up after a positive lead from Wall
Street, where optimistic corporate news from the likes of IBM
<IBM.N> had pushed the S&P 500 <.SPX> to a four-month closing
high. []
Japan's Nikkei <> rose 0.4 percent to a seven-week
high, although worries remained that the yen -- whose recent
strength is a big problem for the export-led economy -- could
spike again despite last week's intervention to curb it by the
authorities.
"If you ask whether the mood has turned positive, it is
hard to say yes, even if a worsening in market sentiment has
come to a halt," said Mitsushige Akino, chief fund manager at
Ichiyoshi Investment Management.
Japanese government bonds edged up following gains by U.S.
Treasuries, with any hint that the Federal Reserve may be
leaning towards further quantitative easing seen as positive
for the U.S. debt market. [] []
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a preview of Tuesday's Fed meeting, see:
[]
For PDF on the yuan: http://r.reuters.com/cad44p
For gold in Asian currencies:
http://link.reuters.com/dan54p
For dollar/yen correlations: http://link.reuters.com/wyn43p
For PDF on the yen's rise:
http://r.reuters.com/zuz33p
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
DOLLAR SELLING
The dollar index <.DXY> against a basket of other major
currencies eased 0.2 percent to 81.21, near a five-week low of
80.865 hit last week.
The dollar stood little changed at 85.60 yen <JPY=>, not
far from its post-intervention high of 85.94 hit on Friday.
Tokyo has not been spotted in fresh currency interventions
since its massive yen-selling spree on Wednesday, though
Japan's prime minister warned markets last week that
authorities are ready to step in to curb yen strength again.
[]
More dollar selling by Japanese exporters is expected
towards 86 yen level before the end of September, when many
Japanese exporters close their books.
"Share prices are rising, so there's no strong reason to
buy the yen at the moment. But on the other hand, there will be
yen buying on any dip," said a trader at a major Japanese bank.
The Australian dollar <AUD=D4> spiked to about $0.9477
after minutes from the Reserve Bank of Australia confirmed its
hawkish stance, saying the central bank stood ready to use
interest rates to help manage an expected strong pick-up in the
economy. []
U.S. crude for October <CLc1> delivery slipped 47 cents to
$74.39 a barrel ahead of the contract's expiry later in the
day, resuming last weeks trend on lingering worries about the
health of the U.S. economy, a major factor in demand for
energy. []
Gold <XAU=> was steady around $1,278 an ounce, off the
record $1,283.70 hit in the previous session. [GOL/}
MSCI's index of Asian shares outside Japan <.MIAPJ0000PUS>
rose 0.2 percent, with the energy sub-index the biggest
gainer.
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