13th US rate rise expected (page 2 of 2)

Furthermore, machinery orders, a key gauge of Japan's corporate capital spending, rose in October, providing more evidence of firm's strong desire to invest as they enjoy brisk profits and benefit from a steady recovery in the economy.

On the back of the economy's recovery, Bank of Japan Governor Toshihiko Fukui said he expected the core consumer price index to show a fairly clear rise early next year, suggesting an end to the central bank's ultra-easy policy is on the horizon.

As the week was coming to an end the yen failed to hold onto its gains after Japan unexpectedly revised down its economic growth rate for the July-September quarter to 0.2 percent from an initial reading of 0.4 percent.

Range for this week: Y119.10-Y122.10

Sterling

As the week started sterling managed to strengthen against the dollar and ignored British Chancellor Gordon Brown downgrading Britain's 2005 growth forecast to 1.75 percent from a prior 3 to 3.5 percent forecast.

Meanwhile, the Chartered Institute of Purchasing and Supply/ RBS said its index of services business activity fell to 55.8 in November from 56.1. That was lower than analysts' forecasts of 56.0, but well above the 50 mark that divides expansion from contraction.

However, sterling failed to hold to its gains after the release of unexpected weak manufacturing data rekindled prospects of a further British interest rate cut early next year.

Figures from the office for National Statistics
showed manufacturing output fell 0.7 percent in October, the third monthly decline in a row and its sharpest fall in seven months, versus analysts' expectations of a rise of 0.2 percent.

On the last trading day sterling climbed to a one-month high against the dollar, helped by better-than-expected trade data. Britain's trade deficit narrowed to 4.55 billion pounds in October from a revised 5.6 billion the month before and much less than the 5.3 billion economists had anticipated.

Range for this week: $1.7400-$1.7700