[B]Market Review - 20/05/2013 [I]23:02GMT[/I]
Yen rises on Amari’s comments[/B]
The Japanese yen rose against the greenback on Monday after Japan Economy Minister Akira Amari said on Sunday that further losses in the yen would have negative effects on the country’s economy. The greenback was pressured throughout the day on expectations that Federal Reserve Chairman Ben Bernanke would hint to trim its bond purchases this week.
Japan’s Amari spoke on a Sunday talk show on NHK and said ‘it’s being said that the correction of the strong yen is largely completed. If the yen keeps on weakening a lot more, it will have a negative impact on peoples’ lives.’ He also added that if the weakening of the yen does have a negative impact on living costs, “it’s our job to figure out how to minimize that.”
Earlier, the greenback opened lower and tumbled briefly but sharply to an intra-day low at 102.00 in New Zealand morning, however, price pared intra-day losses and recovered to 102.92 in Australia. Dollar remained under pressure in Asia and weakened further in European morning before falling to 102.17 in New York afternoon.
Although the single currency came under selling pressure in New Zealand and dropped to session low at 1.2819 at Asian open, price pared intra-day losses and rose to 1.2878 in European morning. Despite a brief pullback to 1.2842 in New York morning, renewed dollar’s weakness pushed the pair higher and price climbed to an intra-day high at 1.2901 in New York afternoon.
The British pound also came under selling pressure in New Zealand and dropped to session low at 1.5166 in Australia, however, cable pared intra-day losses and rose in tandem with euro to 1.5219 in European morning. Price continued to trade with a firm undertone and found a fresh wave of buying in New York morning, pushing the pair higher to an intra-day top at 1.5281 in New York afternoon.
In other news, Japan’s MoF panel said ‘absolutely no guarantee Japan domestic savings will continue to fund JGB purchases; failure to meet budget-cutting promise cud cause spike in interest rates, offset effects of monetary easing; if interest rates rise in deviation fm fundamentals, that wud damage medium, long-term economic growth.’
On the data front, Japan leading indicators rose to 97.9 in March from 97.6 previously. U.S. Chicago Fed index dropped to -0.53 from previous figure of -0.23.
[B]Data to be released on Tuesday : [/B]
Japan all industry index, Germany PPI, U.K. PPI, ONS house price, CPI, RPI and U.S. redbook retail sales.