* Aussie jumps to the year's high on RBA hawkish remarks
* S&P Case-Shiller Home Price, Treasury 2-yr note sale eyed
By Satomi Noguchi
TOKYO, July 28 (Reuters) - The dollar held near an eight-week
low against the euro on Tuesday with investors keen to see if
more U.S. data would add to hopes for a housing industry
recovery.
The Australian dollar raced to its highest level this year
on surprisingly hawkish remarks from Australia's central bank
chief that fuelled speculation that higher rates may be in the
offing.
U.S. home sales surged in June, data on Monday showed,
spurring investor risk appetite with money flowing in to
equities, the euro and higher-yielding currencies like the
Australian dollar.
The market is now looking to Tuesday data on May home prices
for more confirmation that the U.S. housing market may be
starting to recover from the worst of its slump -- a root cause
of the global economic crisis. []
"The general market tone for a softer dollar and yen remain
unchanged amid a solid performance for stocks. Investors are
opting for riskier assets," said Kazuyuki Kato, treasury
department manager at Mizuho Trust & Banking.
The euro rose 0.3 percent to $1.4275 <EUR=> from late U.S.
trade on Monday, near $1.4299 struck on trading platform EBS a
day before, its highest since early June.
Talk of a euro/dollar option barrier at $1.4300 <EUR=> has
been hindering the euro from rising above that level after
approaching it three times in the past week, dealers said.
Against the yen, the euro erased earlier losses and traded up
0.2 percent at 135.75 yen <EURJPY=R>, in sight of a four-week
high of 136.11 yen struck on EBS on Monday.
The dollar edged down 0.1 percent to 95.10 yen <JPY=> as
Japanese exporters sold it to repatriate their overseas earnings,
but it was still close to a three-week peak of 95.39 yen hit the
previous day.
The Australian dollar climbed above $0.8300, its highest
level since September 2008, up 0.9 percent on the day.
It quickly shed earlier losses after Reserve Bank of
Australia Governor Glenn Stevens said low rates could inflate
house prices and there was no rule that dictates the RBA has to
wait for unemployment to peak before raising rates.
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The Aussie rose 0.8 percent to 78.99 yen <AUDJPY=R>, its
highest level since mid-June.
Tuesday's data includes the Standard & Poor's/Case Shiller
national home price report for May due at 1300 GMT and the
Conference Board's July reading on consumer confidence out at
1400 GMT.
Asia stocks were steady on Tuesday, as investors took a
breather after a two-week rally, though profit-taking was
contained by hopes for solid corporate results in the region.
[]
Investors were also bracing for Tuesday's $42 billion sale of
two-year Treasury notes, part of this week's record $115 billion
worth of debt auctions. []
"Treasury auctions are under way and investors are continuing
to watch what is being discussed between the U.S. and China, so
it will probably be hard to build large positions," said Yuji
Saito, head of the forex sales department at Societe Generale.
U.S. officials reassured their counterparts from China on
Monday that the United States would return to a more sustainable
fiscal situation and the two sides grappled over currency
policies in high-level talks, senior Obama administration
officials said. []
(Additional reporting by Kaori Kaneko and Charlotte Cooper;
Editing by Edwina Gibbs)
