By Hiroyuki Kachi 
 

The dollar was moderately lower against the yen in directionless Asia trade Thursday, with a weaker Nikkei Stock Average prompting buying of the haven Japanese currency.

Around 0450 GMT, the dollar was at Y119.85, compared with Y120.00 late Wednesday in New York.

In early trade, the U.S. currency weakened, as the benchmark Nikkei opened lower after weak Japanese machinery orders data. The benchmark Nikkei was down 0.9% midday.

Japanese core machinery orders fell at a faster pace than expected for a third straight sequential decline, amid concerns about an economic slowdown in China.

In recent trading, the U.S. currency stayed top-heavy in a tight range of trade given a lack of fresh cues.

Investors are keeping an eye on events abroad, especially the U.S. Federal Open Market Committee's minutes for its September meeting set to be released later Thursday, to glean any insight about the timing of a potential rate increase. San Francisco Fed Bank President John Williams said recently that the Fed's decision to stand pat last month was a close call.

"That's something we need to check out," as a series of actions by central banks is adding uncertainties to the financial markets, said Toshihiko Sakai, senior manager of forex and financial products trading division at Mitsubishi UFJ Trust and Banking.

Wednesday, the Bank of Japan held steady at its policy-setting meeting. In addition, Governor Haruhiko Kuroda suggested a negative interest-rate policy wasn't yet on the table.

Mr. Sakai said he expects tough conditions a month from now because of likely reductions or cancellations of investment allocations on riskier assets such as stocks by pension funds and other investors through hedge funds after a China-induced selloff in August.

"We are not in the time zone to see an improvement in risk sentiment," said Mr. Sakai, noting that applications to cancel asset-management contracts are due between mid-October and mid-November, 45 days ahead of the industrywide Nov. 30 or Dec. 31 hedge-fund book closing.

Some hedge funds have decided to close the door after a period of turmoil in global markets. The Wall Street Journal reported private-equity firm Bain Capital LLC told investors it would shut down one of its hedge funds.

The U.S. currency was weaker against the euro, which rose to $1.1210 midday from $1.1237 late Wednesday. The common currency was at Y134.95 from Y134.88.

The WSJ Dollar Index, a measure of the dollar against a basket of major currencies, was down 0.03% at 87.86.

 
Interbank Foreign Exchange Rates At 00:50 ET / 0450 GMT 
 
                           Latest       Previous   %Chg    Daily    Daily   %Chg 
Dollar Rates                               Close            High      Low  12/31 
 
USD/JPY Japan           119.85-86      120.01-02  -0.13   120.12   119.84  +0.11 
EUR/USD Euro            1.1258-61      1.1236-39  +0.20   1.1261   1.1236  -6.93 
GBP/USD U.K.            1.5306-08      1.5317-19  -0.07   1.5321   1.5298  -1.74 
USD/CHF Switzerland     0.9718-22      0.9734-38  -0.16   0.9742   0.9720  -2.24 
USD/CAD Canada          1.3064-69      1.3053-58  +0.08   1.3073   1.3052 +12.43 
AUD/USD Australia       0.7171-75      0.7206-10  -0.49   0.7217   0.7165 -12.21 
NZD/USD New Zealand    0.6594-600      0.6607-13  -0.20   0.6630   0.6586 -15.37 
 
Euro Rate 
 
EUR/JPY Japan           134.93-97      134.83-87  +0.07   135.02   134.72  -6.89 
 
Source: Tullett Prebon 
 

Write to Hiroyuki Kachi at Hiroyuki.Kachi@wsj.com

(END) Dow Jones Newswires

October 08, 2015 01:57 ET (05:57 GMT)