Yen gains as lawmaker says party to oppose Iwata

Euro Trade

The euro fell earlier today as Citigroup Inc. said Italy may have to hold a new election to resolve a political deadlock created by an inconclusive vote on Feb. 24-25. The nation is scheduled to sell as much as 7.25 billion euros ($9.5 billion) of bonds tomorrow.

European Central Bank policy makers last week kept their benchmark interest-rate unchanged at 0.75% while lowering forecasts for economic growth and price increases. “In the short term, we in the euro area have, if anything, declining inflation risks,” Bundesbank President Jens Weidmann said in a statement today when the Frankfurt-based central bank released its 2012 annual report.

“You just had Weidmann saying he expects inflation to come down,” BNP’s Gorra said. “Coming from one of the biggest hawks out there, to me that’s a sign they can cut rates at some point. Again, another negative for the euro.”

Japan Politics

Japan’s Iwata may be confirmed even without backing from the Democratic Party of Japan if Prime Minister Shinzo Abe can secure the support of smaller opposition parties. The central bank can end deflation solely through buying government debt and doesn’t need to purchase riskier assets to meet its inflation target, Iwata said today in parliament.

The DPJ will endorse Haruhiko Kuroda as central bank governor and Hiroshi Nakaso as one of the deputy governors, policy chief Mitsuru Sakurai said today in Tokyo. Current governor Masaaki Shirakawa will step down on March 19.

The yen has tumbled 8% this year, the worst performer of 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The dollar rose 3% and the euro gained 1.7%.

Bloomberg News

<< Page 2 of 2

Copyright 2014 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Comments
comments powered by Disqus