On Friday, ECB President Mario Draghi delivered a damning indictment on the Eurozone economy, saying that underlying growth momentum remains weak, the economic situation in the euro-area remains difficult and that the inflation situation has become more challenging.
The yen dropped to a seven-year low against the dollar as investors bet Japan’s Prime Minister Shinzo Abe will win an early election, renewing his mandate to pursue stimulative monetary policy and structural changes.
Japan’s economy has had a wild first 48 hours of the trading week. An abysmal Q3 GDP report, PM Shinzo Abe has pushed back next year’s planned sales tax hike and called for snap elections to take place in less a month to consolidate his political power.
Less than 24 hours after heads of state gathering in Brisbane, Australia, agreed to take measures that would boost their economies, the Cabinet Office delivered news in Tokyo that Japan’s gross domestic product unexpectedly shrank an annualized 1.6%.
The yen fell to a seven-year low versus the dollar on speculation Japan’s Prime Minister Shinzo Abe is considering postponing a planned sales-tax increase and preparing to call a snap election next month.