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Euro, yen edge higher in quiet forex market

The euro was slightly higher against the dollar while the yen picked up a little ground in mostly quiet forex market action Monday.

NEW YORK: The euro was slightly higher against the dollar while the yen picked up a little ground in mostly quiet forex market action Monday.

A fall for the third straight month in German industrial production in May hit share markets but had no real impact on the common currency.

According to the economy ministry, industrial output decreased by 1.8 per cent in May, after slipping by 0.3 per cent in April. Manufacturing output was down 1.6 per cent and construction output off 4.9 per cent.

Analysts said a key cause was slowing economies in Asia and the Ukraine crisis.

The numbers show that "risk factors like slowing emerging market economies, including China, and geopolitical conflicts do have an impact on the German economy," said ING DiBa economist Carsten Brzeski.

"The German industry is currently treading water. Already last week, German new orders had dropped in May, with the sharpest drop coming from orders from outside the Eurozone," Brzeski said.

Analysts continued to put a cap on the euro's potential upside, pointing to the European Central Bank's continued dovish stance, even after it kept its monetary policy unchanged last week.

"The ECB's 'lower for longer' stance is prohibitive for the Euro because the British pound and the US dollar are being bombarded with strong economic data and rising sovereign yields as a result," said Christopher Vecchio at DailyFX.

2100 GMT MONDAY    FRIDAY

EUR/USD 1.3604           1.3595

EUR/JPY 138.59            138.76

EUR/CHF 1.2155          1.2157

EUR/GBP 0.7942           0.7922

USD/JPY 101.87           102.07

USD/CHF 0.8935          0.8942

GBP/USD 1.7128          1.7160

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