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Buffett buys into Goldman

TOKYO, September 24 – The dollar rose against the yen in Asian trade Wednesday on news that US tycoon Warren Buffett\’s Berkshire Hathaway has agreed to buy five billion dollars of stock in Goldman Sachs.

But the greenback was lower against the euro as concerns lingered that a US financial sector rescue plan was getting bogged down in political bickering.

The dollar climbed to 105.82 yen in Tokyo afternoon trade from 105.49 late Tuesday in New York. The euro gained to 1.4668 dollars from 1.4657 and to 155.21 yen from 154.64.

"Many players probably started the Tokyo session convinced that the yen would rise" on fears that US Congress may block swift passage of the bank bailout plan, Barclays Capital trader Motonari Ogawa told Dow Jones Newswires.

"But then the news about Goldman Sachs came out, forcing them to buy back" other currencies against the yen, he said.

The market was nervous after US lawmakers stiffened their opposition to the Treasury\’s 700-billion-dollar proposal to buy bad mortgage-backed debt from struggling Wall Street investment giants, dealers said.

Japan\’s central bank injected an additional 1.5 trillion yen (14.2 billion dollars) into the Tokyo money market after worries about a US financial rescue plan sparked fresh turmoil on global bourses.

"With the bailout plan bogged down in continuing discussions with the Congress, there hasn\’t been much easing in bank funding pressures," noted National Australia Bank currency strategist John Kyriakopoulos.

The cost of the rescue has also raised concerns among investors about where the money will ultimately come from.

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But the dollar\’s fall was limited by news that business activity in the 15-member eurozone slumped in September to the lowest level since just after the September 11, 2001 terrorist attacks, fuelling fresh fears of a recession.

"This was a reminder that global economic activity was continuing to weaken, which took some pressure off the dollar," said Kyriakopoulos.

The market was waiting for new US home sales data later in the day. Analysts say the US government needs to put a floor under falling home prices, the root cause of the global financial crisis.

Against regional Asian currencies, the dollar rose to 1,154.00 South Korean won from 1,122.30 on Tuesday, to 31.95 Taiwan dollars from 31.92 and to 46.40 Philippine pesos from 46.22.

It firmed to 9,340 Indonesian rupiah from 9,295, to 1.4151 Singapore dollars from 1.4107 and to 33.99 Thai baht from 33.94.

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