FOREX-Risk-off move boosts yen versus dollar

(New throughout; changes dateline, previous LONDON)
By Kate Duguid
NEW YORK, Nov 14 (Reuters) - The U.S. dollar fell against
the Japanese yen on Thursday morning, though it was steady
against the euro, on diminished risk appetite amid ongoing
political turmoil in Hong Kong and weak data from Asia and
Europe.
The Japanese yen JPY= and Swiss franc CHF= , both
safe-haven assets, were up 0.23% and 0.21% against the dollar in
early trade. That risk-off move also bolstered U.S. Treasury
bond prices and hit the Dow Jones .DJI and Nasdaq .IXIC
indexes, all common risk-off market reactions.
"The developments in Hong Kong that started Asia off on a
negative note, the ongoing turmoil that's going on in Latin
America, in particular Chile," were driving trade this morning
said Paresh Upadhyaya, director of currency strategy and
portfolio manager at Amundi Pioneer Investments.
Hong Kong pro-democracy protesters paralyzed parts of the
city for a fourth day on Thursday, forcing schools to close and
blocking highways, as students built campus barricades and the
government dismissed rumors of a curfew. "Then we had a slew of disappointing macroeconomic numbers
out of Australia, Japan and China. As New York opened up, you
had those three factors that weighed on sentiment."
China's factory output growth slowed more than expected in
October, Japan's economy ground to a standstill in the third
quarter and the German economy only narrowly avoided a recession
in the third quarter. The dollar, however, was higher against the euro EUR= in
mid-morning trade. The dollar generally gains toward the end of
the year as investors wind down trading, and demand has been
strengthened this year by higher interest rates and stronger
economic growth in the United States.
Also on Thursday, the Labor Department reported that U.S.
producer prices increased by the most in six months in October,
lifted by gains in the costs of goods and services, further
bolstering the Federal Reserve's stance that it will probably
not cut interest rates again in the near term. "The fact that wholesale inflation did surprise to the
upside I think does speak to the narrative that core PCE, the
Fed's measure of inflation, should hit or even breach the Fed's
target of 2%," said Upadhyaya.
"This vindicates the Fed's stance of this current easing as
a mid-cycle rate adjustment."