US dollar still in favour (page 2 of 2)

Fukui's comments came after a two-day meeting at which the central bank kept its ultra-loose policy unchanged, as expected, and said it saw consumer prices rising by the year end, after around seven years of stubborn deflation.

Range for this week: Y117.50-Y120.50

Sterling

At the start of the week, sterling fell against the dollar on weak U.K. economic data. British producer prices rose 2.6 pct year-on-year in October, weaker than market expectations of 2.9 pct, the weakest reading since June.

On a month-on-month basis, prices tumbled 0.1 pct against a rise of 0.7 pct in September. In addition, UK consumer price inflation slipped 2.3 pct in October from a record of 2.5 pct the previous month.

As the week advanced, the pound extended its losses and fell to a two-year low against the greenback after a dovish Bank of England inflation outlook. The BoE's quarterly inflation report, said inflation would meet its 2.0 pct target in two years, re-opening debate on the possibility of a rate cut.

Meanwhile, Bank of England Governor Mervyn King, speaking on the inflation report, stated the bank did not anticipate future decisions. He also added that there was no reason to expect a sharp rise in sterling against the euro.

In the week ahead, markets will watch the Bank of England's Monetary Policy Committee publishing its minutes for November for further clues on the outlook of the British interest rates.

Range for this week: $1.7000-$1.7300