Dollar mixed ahead of key data

TOKYO (AFP) - The dollar edged up against the yen but stayed close to a record low against the euro in Asian trade Tuesday as players sat on their hands ahead of a batch of US economic data, dealers said.

They said the market was also looking ahead to an upcoming speech by US Federal Reserve chairman Ben Bernanke.

Participants in Tokyo showed little reaction to a powerful earthquake which struck northwest of the Japanese capital on Monday, when financial markets were closed for a national holiday.

The dollar firmed to 122.03 yen in Tokyo morning trade from 121.88 in New York late Monday.

The euro was flat at 1.3774 dollars, hovering close to its record high of 1.3814 struck last week. The single currency rose to 168.02 yen from 167.85.

The British pound declined to 2.0354 dollars as players locked in profits after sterling hit a fresh 26-year high of 2.0404 dollars, dealers said.

Other major currencies moved within narrow ranges as players awaited fresh leads on the health of the US economy amid concern about problems in the sub-prime mortgage market catering to people with patchy credit histories.

"Trade is directionless as the market is waiting for key indicators given concern about the US sub-prime market," said Yoshifumi Suzuki, forex dealer at Hachijuni Bank.

US producer prices and industrial production will be published on Tuesday, along with the latest National Association of Home Builders survey, followed by consumer price inflation and new housing starts on Wednesday.

Bernanke meanwhile is due to give semi-annual Congressional testimony on Wednesday with markets eager to hear his assessment of the health of the housing market and the inflation outlook, dealers said.

In recent weeks, the dollar has fallen sharply on concerns that the troubled US housing sector could spread into the wider American economy.

The euro and the British pound meanwhile remained supported by prospects of rising interest rates in Europe, dealers said.

But players also want to see the ZEW economic research institute's survey of German investor confidence due later Tuesday amid concern that the eurozone's largest economy may be losing some steam.

"There is a feeling that the (German) economy is not growing as strongly and the market is looking to see when growth will peak out," said Suzuki.

"But I think it is too early to be looking for that and the euro is expected to remain strong against other currencies," he added.