Dollar jumps in Asia

TOKYO: The dollar climbed in Asia on Thursday thanks to strong US housing data while the euro took a hit following another slip in a closely watched survey of German business confidence.

In afternoon Tokyo trade the greenback bought 109.17 yen, up from 109.04 yen in New York and well up from the 108.52 yen in Asia earlier Wednesday.

The euro slipped to $1.2768 from $1.2781 in New York where it fell below $1.28 for the first time since July last year. However, it picked up to 139.50 yen against 139.37 yen.

The US Commerce Department on Wednesday said sales of new single-family houses surged 18 percent in August to an annual rate of 504,000, their fastest pace in more than six years. While that boosted the dollar against the yen, it was given further support against the euro after the Ifo survey of business confidence in eurozone giant Germany hit a 17-month low in September.

The figures come a day after a key survey showed business activity in the 18-nation eurozone slowed further in September, adding fuel to fears about the eurozone´s stuttering recovery.

"The juxtaposition of another significant downside eurozone data surprise and a major upside surprise for US new home sales has -- unsurprisingly -- pushed the euro below 1.28 against the US dollar," National Australia Bank said in a note.

"What the weak Ifo business climate reading has done is reinforce expectations for more aggressive action from the ECB (European Central Bank), something which both the eurozone bond and stock markets liked," it added.

The ECB´s decision-making governing council voted this month to cut the bank´s key interest rates to an all-time lows to head off deflation in the bloc.

It also promised to launch an asset-purchase programme in a bid to inject cash into the economy.