Dollar weaker in Asia ahead of Bernanke speech

TOKYO, Jan 10, 2008 (AFP) – The dollar softened in Asian trade Thursday as market players waited for clues from Federal Reserve Chairman Ben Bernanke on the chances of further US interest rate cuts, dealers said. The dollar eased to 109.87 yen in Tokyo morning trade from 109.93 in New York late on Wednesday.

The euro firmed to 1.4679 dollars from 1.4660 and to 161.24 yen from 161.17.

“The dollar softened for technical reasons and pessimism over the subprime problems,” said Daisuke Uno, chief strategist at Sumitomo Mitsui Banking Corp.

In a week with few economic indicators to guide markets, players were sitting on their hands ahead of Bernanke’s speech later in the day in Washington, where he is expected to give his overall assessment of the US economy.

The market was keenly awaiting his speech in hopes of discovering clues on the direction of monetary policy.

“But markets already know that he is going to acknowledge a weak outlook for the economy and the only way (for the Fed to proceed) from here is a rate cut” at the Fed’s next two-day meeting later this month, said Uno.

A growing number of analysts expect the Fed to slash its key lending rate by half a percentage point at its Ja