By Lisa Twaronite, MarketWatch
TOKYO (MarketWatch) — The dollar edged down in Asian trading Friday, after it pared recent gains as the U.S. Treasury received strong demand at its 30-year-bond auction.
The bonds sold at a much lower yield than traders expected. Sharply rising yields this week gave the greenback a lift by drawing investors to the currency.
The dollar index (DXY 79.88, -0.19, -0.24%) (DXY 79.88, -0.19, -0.24%) , a measure of the greenback’s performance against a basket of six other currencies, slipped to 79.971 from 80.042 in late North American trading Thursday.
The euro (EURUSD 1.3260, +0.0023, +0.1738%) rose up to $1.3249 from $1.3243 late Thursday.
Against the yen, the dollar (USDYEN 83.5400, -0.1600, -0.1911%) fell to ¥83.69 from ¥83.71.
The Australian dollar (AUDUSD 0.9883, +0.0045, +0.4575%) bought 98.55 U.S. cents, up from 98.47 on Thursday, when the Aussie soared after the Australian unemployment rate ticked down to 5.2% in November, from October’s 5.4% reading.
Thin liquidity could affect trading conditions this month, strategists said. This could keep currency pairs range-bound, or it could amplify the effects of any moves that do occur.
“The final weeks of the trading year hold holidays for many countries and the close of the accounting year for a considerable portion of global traders means there is a broad swath of the market unwinding and a sharp drop in participation,” said John Kicklighter, currency strategist at DailyFX, in a note to clients.
Earlier Friday, China released data showing exports and imports topped economists’ estimates. The results bode well for global demand, but also keep pressure on Beijing to further tighten policy and allow its currency to appreciate, analysts said. Read more on China trade data.
Beijing has recently begun to allow the yuan to appreciate at a faster rate against the U.S. dollar to ease inflation, but it has been mostly stable since the middle of last month.
