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Dollar rally takes breather in Asia

In Tokyo, the greenback bought 123.98 yen against 124.15 yen in New York, where it briefly jumped to 124.50 yen.

Tokyo: The dollar eased against the yen on Friday after a three-day rally driven by upbeat US economic growth and expectations of a Federal Reserve interest rate hike as early as September.

In Tokyo, the greenback bought 123.98 yen against 124.15 yen in New York, where it briefly jumped to 124.50 yen.

The euro strengthened to $1.0942 from $1.0931 while it edged down to 135.67 yen from 135.70 yen in US trade.

On Thursday, the US Commerce Department said the world`s top economy expanded at an annualised rate of 2.3 percent in the April-June period, the strongest since the third quarter of 2014.

And while the figure was a little below expectations, the department also revised up its estimate on the first quarter of the year -- which was hit by severe winter weather -- to growth of 0.6 percent, from a 0.2 percent contraction.

"The US dollar remains supported by the looming Fed tightening cycle," Imre Speizer, a senior market strategist at Westpac Banking Corp. in Auckland, told Bloomberg News.

"As we get closer to that date and get possible clues from speeches by officials over the next few weeks, I expect the dollar to auto-resume its upward trend."

The Fed has suggested that it will hike interest rates by the end of the year, with analysts tipping September or December as being the most likely months for an announcement. The latest growth figures have fuelled speculation the bank will move sooner than later.

Earlier Friday, another round of soft Japanese inflation data fanned talk of more monetary easing by the country`s central bank.

The internal affairs ministry said household spending fell 2.0 percent year-on-year in June against market expectations for an increase after a rise of 4.8 percent in May.

Core inflation, excluding volatile fresh food prices, was up 0.1 percent, well short of the Bank of Japan`s 2.0 percent target.

"The BoJ is having a little trouble with that inflation data, in that it isn`t doing what they would like. It is stubbornly staying low," National Australia Bank said in a commentary.