Monday September 22, 2014 - 00:27:45 GMT
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Reuters - www.reuters.com
FOREX-Dollar well bid on Fed outlook, no G20 reprieve for yen
* Dollar hovers near 6-year high versus yen
* Currencies not high on G20 agenda, seen weighing on yen
* Euro brushes 14-month low against overall bullish dollar
By Shinichi Saoshiro
TOKYO, Sept 22 (Reuters) - The dollar hovered near six-year highs against the Japanese yen on Monday, underpinned by expectations the world's biggest economy will see the start of its rate-tightening cycle sooner-than-expected.
The yen didn't get any help from the weekend meeting in Cairns, Australia, of finance ministers and bank chiefs from the Group of 20 leading nations, where currencies got little mention.
The G20 said they are tantalisingly close to adding an extra $2 trillion to the global economy and creating millions of new jobs, but Europe's extended stagnation remains a major stumbling block.
"Currency movements look to have drawn little focus at this weekend's G20 meeting," Todd Elmer, currency strategist at CitiFX in Singapore, wrote in a note to clients.
"This will likely be viewed as JPY-negative since it runs counter to building speculation that authorities, both foreign and domestic, are becoming more concerned with recent depreciation," Elmer said.
Japanese Finance Minister Taro Aso suggested this month that a sharp decline in the yen would be unwelcome, preferring instead more gradual moves.
The dollar dipped 0.1 percent to 108.88 yen after hitting a six-year high of 109.46 on Friday.
The dollar rallied 1.6 percent against its Japanese counterpart last week, drawing encouragement from the Federal Reserve's higher projections of future interest rates.
The dollar was also on the front foot against the euro.
With the Scottish referendum out of the way, the focus was seen returning to diverging monetary policies between the United States and Europe.
The euro stood nearly flat at $1.2844 after touching a 14-month trough of $1.2826.
The common currency has taken a spill on expectations the European Central Bank will continue to keep policy easy, and perhaps take further steps to shore up the European economy, in stark contrast to the Fed's hawkish rate projections.
Sterling lacked momentum after briefly jumping against the dollar on Friday on relief after Scotland rejected independence.
The pound fetched $1.6318 after momentarily rising above $1.65 on Friday.
Major political risks - including the fallout of the Scottish referendum to next May's general election - still lie ahead for the pound and other UK assets, analysts said.
The Australian dollar also continued to struggle against the U.S. dollar on the Fed policy views.
The Aussie was at $0.8938, with a break below $0.8920 taking the antipodean unit to a fresh six-month low against the dollar. (Editing by Shri Navaratnam)
© Thomson Reuters 2014. All rights reserved
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