AFP, Tokyo :
The euro firmed against other major currencies in Asia on Monday after the European Central Bank gave a large majority of banks in the region a clean bill of health.
The common currency rose to $1.2704 and 137.14 yen in Tokyo afternoon trade from $1.2666 and 136.97 yen in New York Friday afternoon.
The dollar slipped against the yen ahead of the Federal Reserve’s two-day policy meeting starting on Tuesday.
The dollar was at 107.94 yen from 108.14 yen in US trade Friday afternoon.
In the most in-depth and stringent audit of eurozone banks ever undertaken-aimed at preventing a repeat of the crisis that nearly led to the euro’s collapse-the ECB said Sunday it found that 25 out of a total 130 banks had a combined capital shortfall of 25 billion euros ($31 billion) at the end of 2013.
It was “positive” that the capital shortage was within expectations and all major banks cleared the stress tests, said Junichi Makino, chief economist at SMBC Nikko Securities.
“Risks that the European crisis will occur again are extremely low,” he said in a note, adding the ECB has been supplying ample funds.
The Bank of Japan policymakers are to meet on Friday but Nomura Securities expects the bank to hold off further easing measures, said Yujiro Goto, senior forex strategist at Nomura.
“Economic data released since the previous meeting have been mixed, and we doubt the BoJ will rush into additional easing at this point,” he said in a note.
Japanese consumer spending has been slack since the government raised the sales tax in April.
Public broadcaster NHK reported Monday that the BoJ is expected to lower its growth forecast for the current fiscal year to March due to a dull recovery in personal consumption as well as a slow recovery in exports.
Releasing a twice-a-year outlook report on prices and economic growth to be released after Friday’s policy meeting, the bank is expected to lower its growth estimate from 1.0 percent to somewhere above 0.5 percent, it said. The dollar was lower against other Asia-Pacific currencies.
It edged down to 32.38 Thai baht from 32.41 baht on Friday, to Sg$1.2746 from Sg$1.2762 and to Tw$30.38 from Tw$30.40.
It also fell to 1,052.35 South Korean won from 1,057.85 won, to 61.21 Indian rupees from 61.28 rupees, to 12,059.50 Indonesian rupiah from 12,071.00 rupiah, and to 44.75 Philippine pesos from 44.81 pesos.
The Australian dollar rose to 88.13 US cents from 87.61 cents while the Chinese yuan was at 17.62 yen against 17.64 yen.
