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7/28/2019 Yen at Almost 100 to Dollar for Second Day; N.Z. Currency Climbs San Francisco Chronicle
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Yen at Almost 100 to Dollar for Second Day; N.Z. Currency
Climbs San Francisco Chronicle
April 11 (Bloomberg) The yen for a second day reached the weakest level in four years, whenit last traded at 100 per dollar, as traders speculated Bank of Japan stimulus measures will keep
driving investors into higher-yielding currencies.
The Japanese currency traded within 0.2 percent of the 100- yen level yesterday and within 0.1
percent today. The dollar slid against most major peers as investors bet that central banks
around the world will maintain stimulus measures. The New Zealand dollar climbed to the
highest level since August 2011, and the euro reached a six-week high against the greenback.
The trend for weaker yen should continue, and in that sense I dont think its surprising that
people are still willing to sell the yen on strength, Brian Daingerfield, a currency strategist atRoyal Bank of Scotland Group Plcs RBS Securities unit in Stamford, Connecticut, said in a
phone interview. Weve been seeing some flow that may be driving the yen weaker.
The yen rose 0.1 percent to 99.68 per dollar at 5 p.m. in New York after gaining 0.7 percent
earlier following data that showed Japanese investors sold foreign bonds last week. The
currency declined as much as 0.2 percent to 99.95, the weakest since April 14, 2009. The dollar
fell 0.2 percent to $1.3099 per euro and reached $1.3138, the weakest since Feb. 28. The 17-
nation common currency rose 0.1 percent to 130.58 yen.
The Dollar Index, which Intercontinental Exchange Inc. uses to track the greenback against thecurrencies of six major U.S. trade partners, touched 82.068, the lowest level since March 15,
before trading at 82.257, down 0.3 percent.
Kiwi Climbs
The New Zealand dollar gained for an eighth day against the greenback, touching 86 U.S. cents
for the first time in 1 1/2 years after reports showed the nations manufacturing expanded last
month and a gauge of home prices advanced. The currency, nicknamed the kiwi, climbed as
much as 1.2 percent to 86.76 cents, the highest since August 2011, before trading at 86.34, up
0.7 percent.
The currency of Canada, another exporter of commodities, reached a seven-week high. The
Canadian dollar gained 0.4 percent to C$1.0105 to the greenback and touched C$1.0084, the
strongest since Feb. 18.
You can see your winners today are ones that normally benefit from central bank
easing, Fabian Eliasson, vice president of corporate foreign-exchange sales at Mizuho Financial
Group Inc. in New York, said in a telephone interview. Are they going more into higher yield?
Yes. Is it because of an overall change in macro perspective? Im not so sure.
Swedens Krona
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Swedens currency strengthened versus the euro and dollar after a report showed consumer
prices were unchanged on an annualized basis in March, above the median of 12 estimates in a
Bloomberg survey. The krona gained 0.4 percent to 8.3223 per euro and climbed 0.7 percent to
6.3539 per dollar.
Colombias peso fell to a one-week low on speculation the government will announce
measures next week that will lead to further declines in the currency. President Juan Manuel
Santos will present a stimulus plan April 15 that includes additional measures to stem gains in
the peso, Finance Minister Mauricio Cardenas said last week. The currency ended the day
down 0.2 percent to 1,823.70 to the dollar after touching 1,827.30.
The yen has lost 13 percent this year versus nine developed-nation counterparts monitored by
Bloomberg Correlation-Weighted Indexes. The euro has gained 0.9 percent, and the dollar has
advanced 1.6 percent.
Japanese investors were net sellers of foreign debt in the week ended April 5, according to data
released by the Ministry of Finance today. They offloaded 1.14 trillion yen ($11.5 billion) in
overseas bonds and notes, purchased 6.3 billion yen in overseas stocks and bought 75.5 billion
yen in overseas short-term securities.
Inflation Goal
Haruhiko Kuroda said yesterday the unprecedented stimulus announced on April 4 after his first
meeting as BOJ governor is enough to achieve a 2 percent inflation goal. The bank is boosting
monthly bond buying to 7.5 trillion yen ($80 billion), suspending a cap on some bond holdingsand dropping a limit on debt maturities.
The central bank has taken all necessary and possible measures, Kuroda told reporters in
Tokyo. While officials will change policy as needed, he doesnt expect adjustments each
month, he said. The BOJ chief reiterated a pledge to do whats needed to meet a 2 percent
inflation target in two years.
Europes shared currency strengthened as Italy sold 4 billion euros of new 2.25 percent 2016
notes at 2.29 percent, down from the 2.48 percent on similar-maturity debt allotted on March 13,
as investors shrugged off risks tied to the nations political crisis.
Cheap Euro
The euro has been cheap versus the dollar, said Michael Sneyd, a currency strategist at BNP
Paribas SA in London. Our analysis shows it has been undervalued, relative to what has been
going on in Italian and Spanish bond markets.
BNP Paribas forecasts the euro will rise to $1.35 within three months, Sneyd said.
The International Monetary Fund said in a report today that global central banks buying assetsand keeping interest rates low to boost growth have had positive short-term effects for banks
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even as risks from the policies are increasing.
Central banks in the U.S., Europe, Japan and the U.K. attacked the longest and deepest
financial slump since the 1930s with unorthodox accommodation.
The Fed spent $2.3 trillion from 2008 to 2011 in two rounds of bond purchases to spur
economic growth. Its now buying $85 billion of debt a month. The Fed has kept its benchmark
interest rate at zero to 0.25 percent since 2008 to support the economy.
Editors: Greg Storey, Kenneth Pringle
To contact the reporter on this story: John Detrixhe in New York at [email protected]
To contact the editor responsible for this story: Dave Liedtka at [email protected]
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