Dollar dips

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TOKYO: The dollar edged down on the yen in early Friday trade against a backdrop of simmering tensions on the Korean peninsula, though the sharp divergence between U.S. and Japanese monetary policy contained the greenback´s losses.

North Korean Foreign Minister Ri Yong Ho said on Friday he believes the North could consider a hydrogen bomb test on the Pacific Ocean of an unprecedented scale, South Korea´s Yonhap news agency reported.

Investors also looked to see how Chinese financial markets would react to S&P Global Ratings´ downgrade to China´s credit rating. The dollar index, which tracks the U.S. unit against a basket of six major rivals, edged down 0.1 percent to 92.156 , up 0.4 percent for the week and holding well above its more than 2-1/2 year nadir of 91.011 marked on Sept. 8. The dollar dipped 0.2 percent to 112.28 yen, but was still up 1.3 percent on the week in which it scaled a two-month peak of 112.725.

On Thursday, the Bank of Japan maintained its policy settings, including its loose pledge to keep buying bonds so its holdings increase at an annual pace of 80 trillion yen ($717.6 billion).