Dollar supported by higher share prices in Asian trade

The dollar held steady in Asian trade on Wednesday, propped up by a Wall Street rally and a drop in world oil prices, dealers said.

They said weak German and French economic data were weighing on the euro.

The dollar was little changed at 104.19 yen in Tokyo morning trade against 104.24 in New York trade on late Tuesday.

The euro edged down to 1.5682 dollars from 1.5686 and to 163.39 yen from 163.53.

The greenback was "supported by higher share prices and oil prices that calmed down overnight," said Shigeru Nakane, senior chief manager at Resona Bank.

Positive comments on the US economy by San Francisco Federal Reserve Bank Chairman Janet Yellen also helped the greenback, dealers said.

"Market players are now keen to see the upcoming US job report," Nakane said.

Washington is due to release weekly jobless claims on Thursday, while key monthly non-farm payroll figures are due next week.

Traders were also waiting for US durable goods orders due later on Wednesday and revised US first-quarter economic growth on Thursday.

The dollar climbed in US trade overnight after oil prices fell more than three dollars a barrel in New York Tuesday, lifting the greenback against other major currencies despite weak economic data.

The US Conference Board reported Tuesday that consumer confidence plunged to a 16-year low in May in a stuttering economy and as surging oil prices pushed inflation expectations to an all-time high.

The dollar retained its firm tone in Asian trading amid a lack of fresh leads, dealers said.

Masatsugu Miyata, forex dealer at Hachijuni Bank, said the euro's recent gains appeared to be excessive, leaving room for the dollar to regain some ground.

"I feel that the European nations have failed to implement effective measures to fight inflation," he said, noting that weak German data had weighed heavily on the single currency.

Germany's GfK consumer confidence indicator fell to 4.9 points in June compared with 5.6 points in May and against analyst forecasts for an improvement to 5.8.

In France also, INSEE reported business confidence dropped four points to 102 in May, beyond estimates for a more modest fall to 104.

"In that sense, it's about time for the dollar to gain despite its vulnerability to high oil prices," Miyata said.