[B]Market Review [/B]- 02/12/2013 [I]23:34GMT [/I]
[B]The Japanese yen weakens on speculation of further economic stimulus
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Although U.S. dollar retreated briefly fm 102.59 in Australia Monday to 102.22 in Tokyo morning on news of Japan EconMin Akira Amari was being hospitalized for 3 to 4 days for some tests together with the retreat in Japanese stock markets, the greenback ratcheted higher and penetrated last Friday’s high at 102.61 in European morning against the Japanese yen on speculation of further economic stimulus. U.S. dollar rose to a fresh 6-month high at 103.13 in New York before easing.
Japanese officials said ‘BoJ working on contingency plans for further economic stimulus; options include major purchases of stock market linked funds; more radical idea is further JGB buying; financial markets see BoJ policy move possibly before April.’
Despite euro’s brief rise to 1.3616 in European morning, the single currency failed to penetrate last Friday’s high at 1.3622 high and euro nose-dived to 1.3526 on active profit-taking despite the release of stronger-than-expected eurozone PMI data.
On the data front, Italy Manufacturing PMI in November came in as 51.4, higher than the expectation of 50.9. France Manufacturing PMI in November came in as 48.4, higher than the expectation of 47.8. Germany Manufacturing PMI in November came in as 52.7, higher than the expectation of 52.5. Eurozone Manufacturing PMI in November came in as 51.6, higher than the forecast of 51.6.
The British pound traded with a firm undertone in Australia and quickly pierced through Fri’s high at 1.6385 to a fresh 2-year peak at 1.6443 after tripping large stops abv 1.6400, however, active profit-taking knocked price lower. Although price jumped fm 1.6380 after release of the upbeat U.K. manufacturing PMI data n climbed back to 1.6427, cable later fell in tandem with euro on dollar’s strength elsewhere and weakened to sessions low of 1.6343 before trading sideways. U.K. Nov Manufacturing PMI came in at 58.4, highest since Feb 2011, versus revised 56.5 in Oct.
[B]Tuesday[/B] will see the release of Australia retail sales, RBA rate decision, China non-manufacturing PMII, U.K, RBC retail sales, construction PMI, EU PPI and U.S. retail sales.