© Reuters. FILE PHOTO: Illustration photo of the Japanese Yen and US Dollar notes
By Masayuki Kitano
SINGAPORE (Reuters) — The dollar set a one-week low against the yen on Tuesday as investors turned cautious after U.S. President Donald Trump is the former campaign manager is charged with the money probe laundering in the Federal Republic of Germany in the Russian meddling in the 2016 presidential elections.
Analysts said the dollar was also weighed down by reports that Trump was probably pick Federal reserve Governor Jerome Powell as the next chief of the U.S. Central Bank.
Powell is rather quiet on the monetary policy than other contenders for the post, especially in comparison to the Stanford University economist John Taylor, who was considered another top contender for the position.
The dollar held steady at 113.15 yen , after slipping as low as 112.97 yen in early Asian trade, its lowest level since Oct. 20.
Federal investigators probing the Russian meddling in the 2016 US elections, Trump charged the former campaign Manager Paul Manafort, and another aide-de-camp, Rick Gates, with money laundering on Monday.
The latest developments in the U.S. Department of justice Special Counsel Robert Mueller’s investigation of alleged Russian efforts to tilt the 2016 presidential election, pressure on the dollar, said Stephen Innes, head of the trade in the Asia-Pacific region for Oanda in Singapore.
«It is weighing on dollar/yen a little. I think it’s a bit of uncertainty,» said Innes, adding the yen drew some support as risk appetite was looking a little shaky.
Asian stocks following weakness on Wall Street were sluggish on Tuesday on Monday.
Because of the low yields and the yen is often used to Fund investments in higher-yielding currencies and assets, to benefit from short-covering, when investors will begin to scale back their risk exposure.
The Bank of Japan’s monetary policy decisions due out later on Tuesday around 0300-0500 GMT, is considered unlikely to hold much influence on the yen, with the Central Bank all but sure-policy is unchanged.
The BOJ is widely expected to keep intact-a promise to lead the short-term interest rates to minus 0.1 percent, and the 10-year Japanese government bond yield at around zero percent.
The euro eases 0.1 percent to $1.1640 , but remained above a three-month low of $1.1574 touched on Friday.
The Australian dollar a little, according to China’s official factory PMI slumped showed growth in China’s manufacturing sector cooled more than expected in October.
The Aussie, which is sensitive to Chinese economic data due to Australia’s strong trade relations with the Asian giant, eased 0.1 per cent to $0.7679 .
To clarify (this story corrects Powell’s perceived attitude to monetary policy in the third paragraph)