Dollar edges higher in Asia after US data fall

The dollar edged up in Asia Wednesday after a sell-off in New York on disappointing US consumer confidence data, while markets shrugged off rising regional tensions over China's expanded air defence zone. The greenback bought 101.38 yen in Tokyo, against 101.31 yen in New York Tuesday. The euro fetched $1.3562 and 137.50 yen compared with $1.3569 and 137.46 yen. On Tuesday the dollar sank in US trade after a gauge of consumer confidence tumbled in November to its lowest level since April. That result indicated that an agreement in Washington to avert a debt default did not significantly reassure people, while the Federal Reserve will bear the figures in mind when deciding a timeline to wind down its stimulus programme. However, there was some good news on US housing on Tuesday, while investors will now be keeping an eye on the release this week of jobless claims data and durable goods orders. "Housing data continued to be robust but disappointing consumer confidence index put a dent on market sentiment," Credit Agricole said. With few big events ahead of the US Thanksgiving holiday Thursday, the "basic trend (of yen weakening) remains unchanged", a senior dealer at a major European bank in Tokyo told Dow Jones Newswires. Markets appeared largely unfazed by news that two US B-52 bombers flew over a disputed area of the East China Sea without telling Beijing, in a challenge China's bid to create an expanded air defence identification zone. Dealers are also looking to November eurozone inflation data this week for clues about whether the European Central Bank will launch further easing measures after cutting rates to a record-low 0.25 percent earlier this month. Credit Agricole said the latest figures could show inflation weaker than the four-year-low 0.7 percent seen in October, which prompted the latest rate cut in a bid to avoid deflation. "Recent speeches from policymakers suggest that the ECB has plenty of policy options at its disposal," it added. "The test of the ECB's reaction function (and the next leg for the euro) will come this week when we get November inflation."