The dollar held above a two-week low versus the yen on Thursday while the Australian dollar rose as an upbeat reading on China’s factory sector eased worries about the outlook for the Chinese economy.
However, market players were keeping an eye on a further jump in China’s money market rates.
A spike in Chinese money market rates on Wednesday had dented Chinese equities and knocked risk-sensitive currencies such as the Australian dollar lower, triggering a broad rise in the yen.
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