TOKYO, JAPAN - The dollar weakened against the yen in Asian trade Tuesday ahead of more US earnings results that could support recent optimism about the world's largest economy, dealers said.
The dollar eased to 93.97 yen in Tokyo morning trade from 94.21 in New York late Monday. The euro slipped to 1.4207 dollars from 1.4233 and to 133.50 yen from 134.10.
Investors were looking ahead to another batch of earnings reports from US firms including Caterpillar Inc, watching for any signs of a turnaround in the ailing construction industry in the wake of surprisingly upbeat housing data. Internet giant Yahoo Inc, investment firm BlackRock and drugmaker Merck will also release their second-quarter results later in the day.
Investors turned to riskier currencies as pessimism faded about the US economy, NAB Capital strategists wrote in a note.
"The debate appears to have moved on from tracking the recession to gauging (the) shape and the timing of the global upturn."
White House economic adviser Larry Summers said Friday that the US economy has come "back from the abyss."
Market players were also relieved that troubled US lender CIT Group reached an emergency loan agreement worth three billion dollars with a group of its main bondholders to avoid bankruptcy.
Meanwhile markets were digesting minutes from the Bank of Japan's June 15-16 meeting that showed policymakers "concurred that Japan's economic conditions had begun to stop worsening."
One member said that firms were finding it easier to secure credit and the central bank needs to "start considering specific ways to terminate the temporary and exceptional measures."
At a subsequent meeting last week, however, the bank decided to extend for the rest of 2009 its policy of buying up corporate debt to keep credit flowing to cash-strapped firms during the recession.
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