TOKYO, Oct 30 (Reuters) - Japan's Global Sovereign fund expects the dollar to weaken further over the next six months, and plans to focus its fund allocation on higher-yielding currencies such as the Australian dollar and Norwegian crown.
Kokusai Asset Management Co Ltd's Global Sovereign Open fund is focusing on the interest rate outlook as a key driver of currency moves, Global Sovereign's chief fund manager, Masataka Horii, told Reuters in an interview on Friday.
Based on that view, the Australian dollar, Norwegian Crown, Canadian dollar and Swedish Crown look attractive to a six-month horizon, he said.
"The dollar is likely to weaken, primarily against such currencies," Horii said. "Our strategy will be to conduct allocations mainly in those four currencies while making allocations to the dollar low overall," he added.
This is because central banks in countries such as the United States and Japan are likely to continue to keep interest rates near zero for the time being, Horii said.
"On the other hand, countries such as Australia and Norway that were not affected as much by the subprime mortgages issue have started raising interest rates, while Canada and Sweden seem likely to raise interest rates after the middle of next year." (Reporting by Masayuki Kitano and Michiko Iwasaki)