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Dollar briefly rallies above ¥109.50 on Trump remarks

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Reuters

The currency came under pressure last week after Treasury Secretary Steven Mnuchin indicated he was broadly supportive of a weak dollar, though U. S.

"There are benefits of where the dollar is and there are costs of where the dollar is", the Treasury secretary said at another panel Thursday, adding that the short-term dollar position was "not a concern of mine".

"I thought my comment on the dollar was actually quite clear yesterday", Mnuchin told in Davos.

He added, Treasury Secretary Steve Mnuchin's "weaker dollar" comments have been misunderstood, suggesting there's no disagreements within the administration over the economic policy. The Standard & Poor's 500 index inched up 0.1 percent to 2,839.25 and the Dow Jones industrial average gained 0.5 percent to 26,392.79. For the week, the MSCI index was up 2 percent.

The euro meanwhile, had risen half a percent to trade just below its December 2014 high of above $1.25 hit on Thursday.

Japanese Finance Minister Taro Aso also emphasized on Friday that the Group of Seven nations - of which Japan is a member - have an agreement to avoid targeting currencies to gain a competitive advantage.

In the wake of the tough talk on trade, Mnuchin's comments were widely interpreted as a possible green light to let the value of the dollar slide to make United States exports cheaper, thereby taking aim at China and other trading partners. A weak currency tends to boost production in the country of that currency, while a stronger currency lends support for consumers as well as tourists looking to travel overseas.

Intel said its data center business did well in the fourth quarter and the "Meltdown" and "Spectre" security flaws aren't affecting its sales. Its stock is up 4.5 percent in the year to date, falling behind the materials sector's 5 percent gains in 2018. Wall Street cheered the move, pushing stocks further into record territory.

Draghi also said the recent surge in the euro was a source of uncertainty, although this had little impact on the currency as some market participants had expected the European Central Bank chief to use stronger language.

A weaker dollar could also have repercussions on stocks, corporate bonds and other risky investments. I expect that the pair may fall to the psychologically important level of 1.3000 before a reversal starts. The euro rose to $1.2423 from $1.2391.

The dollar index, which measures the greenback against a basket of six major currencies, edged up after slipping almost 1 per cent to a fresh three-year low.

ANZ sees prices holding at current levels in the first half of this year, before pushing toward US$1,400 by the end of the year.

Spot gold XAU= was half a percent higher at $1,354.41 per ounce after sliding 0.8 percent overnight.

Copper fell 0.6 percent to $3.19 a pound.

Benchmark U.S. crude rose 63 cents, or 1 percent, to $66.14 a barrel in NY. Brent crude, used to price worldwide oils, dropped 4 cents to $70.38 per barrel in London.

Britain's 10-year yield rose three basis points to 1.444 percent.

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