* G20 meeting fails to give much incentive to currencies
* Focus on Fed, BOJ monetary policy meetings this week
* Dollar boosted by demand from Japanese importers
By Kaori Kaneko
TOKYO, March 16 (Reuters) - The dollar rose broadly on
Monday, with the market looking ahead to a Federal Reserve policy
meeting this week after a Group of 20 finance ministers' meeting
at the weekend gave the market few trading incentives.
The Fed and the Bank of Japan hold policy decisions this
week, with traders waiting to see if the U.S. central bank
signals after its meeting on Tuesday and Wednesday that it will
buy longer-dated Treasuries to help keep interest rates down.
[]
Central banks are seeking unconventional ways to boost their
economies now that many have interest rates at historic lows.
Britain's central bank has already said it would buy gilts, and
the Swiss National Bank intervened last week to weaken the Swiss
franc to stave off deflation.
Dealers said the dollar's gains on Monday were driven largely
by technical trading after it bounced from the day's lows.
"The G20 meeting has had little impact on the forex market,"
said Hideki Hayashi, chief economist at Shinko Securities.
"But it should help the dollar against the yen in the
longer-term as the G20 members' pledge to take fiscal steps is
expected to support shares and boost investor risk appetite."
The G20 finance ministers promised money to help emerging
market economies and said they would use their full fiscal and
monetary power to combat the global downturn. []
The euro fell 0.3 percent from U.S. trade on Friday to
$1.2892 <EUR=>.
The dollar was 0.2 percent higher at 98.20 yen <JPY=> after
rising as high as 98.50 yen on demand from Japanese importers.
But exporters' selling capped further dollar gains, traders said.
It touched a four-month peak of 99.69 yen earlier this month
but has failed to climb above 100 yen.
The euro dipped 0.1 percent to 126.60 yen <EURJPY=> after
touching a two-month high of 127.65 yen on trading platform EBS
last Friday.
Fed Chairman Ben Bernanke suggested in an interview that the
U.S. recession could last most of the year. []
"If the Fed gives a sign for buying long-term Treasuries
following moves by the BoE and the SNB, the dollar is expected to
come under selling pressure," said Yousuke Hosokawa, Treasury
department senior manager at Chuo Mitsui Trust and Banking.
The Bank of Japan holds a meeting this week and may increase
its monthly buying of long-dated government bonds to keep
interest rates low and help boost the economy, Japan's Nikkei
business newspaper reported. []
The BOJ is also considering buying subordinated debt issued
by banks to help bolster their capital, the paper reported on
Monday. []
The SNB shocked markets by intervening to sell the franc last
week, becoming the first major central bank in the current crisis
to try to push its currency down.
The euro was up 0.3 percent at 1.5341 francs <EURCHF=> after
rising to its highest in nearly three months on Friday at 1.5402
francs.
Currency market players are keen to see whether stocks retain
their rising momentum after U.S. shares logged their best week
since November last week. []
Tokyo's Nikkei stock average <> rallied 1.9 percent as
banks surged amid easing fears over the health of U.S. lenders.
[]
"There are expectations that the U.S. will announce details
on measures to buy bad assets. If stocks extend their gains on
hopes for U.S. steps, investors are likely to increase their risk
tolerance, putting downward pressure on the dollar," said Yuji
Saito, head of FX sales at Societe Generale.
The U.S. Treasury will offer more details in the coming week
about how proposed public-private partnerships to take bad assets
off banks' books will work, a senior department official said on
Saturday. []
(Additional reporting by Rika Otsuka; Editing by Hugh Lawson)
