Yen drops after Abe adviser says BOJ can do more

Consumer Sentiment

The yen has fallen 12% this year, the biggest decline among the 10 developed-market currencies tracked by Bloomberg Correlation-Weighted Indexes. The dollar is the biggest gainer, rising 5.1%, while the euro has climbed 2.9%.

The Dollar Index, which Intercontinental Exchange Inc. uses to track the greenback against currencies of six major U.S. trading partners, was little changed at 83.743.

The Standard & Poor’s/Case-Shiller index of property values increased 10.9% from March 2012, the biggest 12-month gain since April 2006, after advancing 9.4% in February, a report showed in New York. The median estimated of economists surveyed by Bloomberg called for a 10.2% advance.

The Conference Board’s index of U.S. consumer sentiment climbed to 71.2 this month, the highest since November, from 68.1 in April, according to the median estimate of economists surveyed by Bloomberg before the report is issued at 10 a.m.

The Dollar Index climbed to the most since 2010 last week after Federal Reserve Chairman Ben S. Bernanke said the central bank may cut the pace of asset purchases if officials see indications of sustained growth.

Fed Tapering

“We expect the data in the U.S. to continue being stronger,” Athanasios Vamvakidis, head of Group-of-10 foreign- exchange strategy at Bank of America Merrill Lynch in London, said in an interview on Bloomberg Television’s “On the Move” with Francine Lacqua. “We expect the discussion of when the Fed will start tapering” to bolster the U.S. currency versus the yen and the euro, he said.

The dollar will advance to $1.25 per euro by year end, he predicted.

South Africa’s rand weakened versus all but one of its major counterparts tracked by Bloomberg.

The nation’s gross domestic product growth slowed to an annualized 0.9% from 2.1% in the fourth quarter, Statistics South Africa said in a report released in Johannesburg today. The median estimate of 15 economists in a Bloomberg survey was 1.6%.

The rand dropped 1% to 9.7169 per dollar and reached 9.7465, the weakest since March 2009.

Aussie Climbs

Australia’s dollar climbed from near the lowest level since June 2012 versus its U.S. counterpart.

“We expect to see short-term strength this week,” Axel Rudolph, a technical analyst at Commerzbank AG in London, wrote in a note to clients. The relative-strength index for the currency “reinforces our bullish outlook,” he wrote.

The 14-day relative strength index for the Australian dollar versus the greenback was 29.9, up from 24.8 yesterday. It is still below the 30 level that traders view as a signal that an asset’s price has fallen too fast.

The Australian dollar advanced 0.5% to 96.83 U.S. cents. It fell to 95.94 on May 23, the lowest since June 1.

Investors should buy the currency at 96.40 U.S. cents and bet it will appreciate to 98 U.S. cents, Rudolph wrote.

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