* Dollar hits 3-month high against broadly weaker yen
* German Ifo falls slightly; eyes on Bernanke
(Recasts, updates prices, adds comment, changes byline,
changes dateline, previous LONDON)
By Nick Olivari
NEW YORK, Feb 24 (Reuters) - The dollar touched a
three-month high against a broadly weaker yen on Tuesday,
ahead of a slew of U.S. economic data and testimony by Federal
Reserve Chairman Ben Bernanke to Congress.
Housing and consumer confidence data are slated for release
during the New York session with Bernanke set to deliver his
semi-annual testimony to Congress later in the day, as he seeks
to offer assurances on the troubled economy.
The dollar was lower against most other major currencies as
U.S. stock futures pointed to a higher Wall Street open, after
indexes touched a 12-year closing low on Monday.
"The main theme is further deterioration in Japan's
economy," said Fabian Eliasson, vice president of foreign
exchange sales at Mizuho Corporate Bank in New York. "The
dollar has a safe-haven bid pushing it up against Japanese
(yen) weakness."
In early New York trade, the dollar was up 1.6 percent at
95.98 yen, having earlier hit a three-month high at 96.06 yen
<JPY=>, according to Reuters data.
The euro climbed to a seven-week high of 122.80 yen
<EURJPY=>. Sterling rose 1.6 percent to 139.13 yen <GBPJPY=>,
while the Australian dollar <AUDJPY=> gained 1.9 percent to
61.77 yen.
The link between yen gains in a perceived safety bid and
stock market tumbles has been broken by worries about Japan's
sharp economic downturn and a lack of convincing policy steps
that erode confidence.
"The driving factor behind some of the yen weakness has
been domestic developments in Japan. ... Figures have looked
pretty bad, and there has also been political turmoil. Taken
together, this has weighed," said Phyllis Papadavid, currency
strategist at SG in London.
Japanese Finance Minister Kaoru Yosano said the government
was looking at stock buying and other methods to support the
share market. For details, see [].
Euro strength against the yen also helped buoy the single
currency versus the dollar. The euro was last up 0.3 percent at
$1.2738 <EUR=>.
IFO UNDERSHOOTS FORECAST
Currency markets shrugged off Germany's Ifo business
climate indicator, which fell to 82.6 in February. That was
slightly lower than forecasts for it to stay at January's level
of 83.0. [].
"We remain a long way away from a recovery scenario and
overall activity levels are dreadful, but there may be evidence
that the trough in the cycle is near, if not here already,"
Audrey Childe-Freeman, senior currency strategist at Brown
Brothers Harriman in London, said in a note to clients.
Traders were expected to keep an eye on developments in the
U.S. banking sector after a report on Monday that the
government could end up owning a stake of up to 40 percent in
Citigroup.
American International Group Inc <AIG.N> looked set to make
the biggest quarterly loss in corporate history and could seek
more U.S. government aid despite the billions of dollars
already committed to it. []
(Additional reporting by Veronica Brown in London; Editing by
Jonathan Oatis)
