* NZD lifted by better-than-expected retail sales
* Investors continue shift to high-yielders, commodities
* Focus on 3rd-quarter U.S. earnings
By Kaori Kaneko
TOKYO, Oct 13 (Reuters) - The dollar drifted against a basket
of currencies on Tuesday but stayed soft against the Australian
dollar, which earlier hit a 14-month high boosted by optimism
that robust U.S. corporate earnings would sustain investors' risk
appetite.
The New Zealand dollar <NZD=D4> also shone, hovering not far
from a 14-month high, after retail sales figures for August beat
expectations and fuelled talk the central bank might soon drop
its explicit easing bias. [] [].
Although overall activity was subdued in Asia, growth-linked
and higher-yielding currencies such as the Aussie and the kiwi
were supported ahead of more U.S. earnings this week.
"It seems the dollar is getting some respite from its fall
against the yen but higher-yielding currencies remain strong and
the general tone of the market still points towards dollar
weakness," said Kazuyuki Kato, treasury department manager at
Mizuho Trust & Banking.
"Investors are still shifting funds into higher-yielding
currencies and commodities," he said.
The dollar edged up 0.1 percent to 89.90 yen <JPY=> from late
U.S. trading on Monday, when the U.S. currency rose as high as
90.47 yen with stops being triggered around 90.30 yen and sellers
lining up around 90.50.
The dollar index <=USD> was steady at 76.170, not far from a
14-month low of 75.767 struck last week.
The greenback received a brief reprieve late last week and
early on Monday after Federal Reserve Chairman Ben Bernanke said
late on Thursday the U.S. central bank stood ready to tighten
monetary policy once economic recovery took hold, prompting
speculators to cover dollar shorts.
But investors are now focused again on U.S. corporate
earnings, which if they beat expectations could boost the
appetite for high-yielding currencies, analysts say.
Some investors sell the U.S. dollar when economic optimism
grows, buying assets such as stocks and commodities instead.
The Australian dollar was steady at $0.9077 <AUD=D4> after
rising as high as $0.9096, its highest since August 2008.
The New Zealand dollar edged down to $0.7372 <NZD=D4> after
rising near a 14-month peak of $0.7457 struck last week.
"Contrary to its promise to keep the cash rate at its current
level until late 2010, we suspect the (New Zealand) central bank
will, albeit reluctantly, begin a tightening cycle by the second
quarter of next year," said Su-lin Ong, a senior economist at RBC
Capital.
The euro <EUR=> was little changed at $1.4780 with resistance
seen around $1.4815. Traders awaited Germany's ZEW economic
sentiment index for October due at 0900 GMT.
Against the yen, the euro rose 0.2 percent to 132.93 yen
<EURJPY=R>.
Big corporate names to post earnings this week include Intel
Corp <INTC.O> and Johnson & Johnson <JNJ.N> on Tuesday, JP Morgan
Chase <JPM.N> on Wednesday, and Goldman Sachs <GS.N> and IBM
<IBM.N> on Thursday. [] []
U.S. economic data this week includes September retail sales
and consumer prices as well as industrial and manufacturing
numbers.
On Tuesday, Federal Reserve Bank of New York President
William Dudley speaks at 1715 GMT while Fed Vice President Donald
Kohn speaks on the economic outlook at 1745 GMT.
(Additional reporting by Anirban Nag in Sydney; Editing by
Michael Watson)
