The yen strengthened from a five-year low as investors assess U.S. economic data to see when the Federal Reserve will start to taper monetary stimulus. Expectations of larger swings in major currencies were near a 2 1/2-month high. While 34 percent of economists surveyed by Bloomberg forecast the Fed will probably decide to reduce $85 billion in monthly bond purchases at its Dec. 17-18 meeting, futures traders bet it will keep interest rates near zero at least until the end of next year. The euro reached a one-month high against the pound ahead of European data on manufacturing and services. “We suspect that the best of the gains in dollar-yen from sub-80 up to above-100 are probably behind us,” Ray Attrill, the global co-head of currency strategy at National Australia Bank Ltd. in Sydney, said in an interview with Bloomberg Television. If the Fed tries to push back against expectations of future policy tightening then, “even if we do get a taper, the net result could be that the U.S. dollar actually softens rather than strengthens on a tapering announcement.” The yen climbed 0.4 percent to 102.85 per dollar as of 1:49 p.m. in Tokyo and advanced 0.3 percent to 141.45 per euro. It reached 103.92 per dollar and 142.83 per euro on Dec. 13, the weakest levels since October 2008. The dollar fell 0.1 percent to $1.3755 per euro following a fifth weekly decline. The MSCI Asian Pacific Index of shares declined 0.4 percent, boosting demand for haven currencies including the yen. It slid 2.9 percent from the end of November to Dec. 13, the biggest two-week drop since Aug. 30.
Posted on: Mon, 16 Dec 2013 06:06:28 +0000
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