Dollar creeps toward fresh seven-year yen high

TOKYO: The dollar crept towards 120 yen and a new seven-year high on Wednesday as a batch of encouraging US data showed further improvement in the world´s largest economy.

In early Tokyo trading, the greenback rose as high as 119.43 yen, before settling to 119.20 yen in afternoon trade -- that compares with 119.22 yen in New York Tuesday afternoon. The US unit last broke the 120 yen level in July 2007.

The yen has been under pressure after Moody´s on Monday lowered its credit rating on Japan´s sovereign debt and later its outlook on five of the country´s commercial banks.

"It wouldn´t be a surprise" if the pair tests the 120 mark later this week, said Yuzo Sakai, manager of FX business promotion at Tokyo Forex & Ueda Harlow.

"Investors may lack a sense of accomplishment until the pair hits 120," he told Dow Jones Newswires.

In other trading, the euro inched up to $1.2383 from $1.2381 in New York while sagging to 147.55 yen from 147.62.

On Tuesday, the US Commerce Department said construction spending rose 1.1 percent in September, almost twice as much as expected, while industry specialist AutoData said the car industry saw a healthy 4.6 percent increase in sales last month.

US online sales also rose 16 percent year on year on Monday, according to the Adobe 2014 Digital Index.

The estimate for Cyber Monday, often seen as the annual high point for online retail, helped offset disappointing data on the "Black Friday" kickoff to the holiday shopping season.

Traders were also focused on Thursday´s European Central Bank meeting after officials dampened speculation of fresh measures to counter the threat of deflation in the eurozone.

"The euro has been stable of late, mainly on the back of falling expectations of the ECB considering a more aggressive monetary policy stance as soon as this week," Credit Agricole said.

The greenback was mixed against other Asia-Pacific currencies.