By Monami Yui and Kristine Aquino -
Nov 12, 2012 10:59 AM GMT+0800
The euro traded 0.3 percent from a
two-month low before European finance chiefs meet today to seek
a program to maintain Greek solvency.
The 17-nation euro remained lower versus the yen, following its biggest weekly loss in four months, even after Greek Prime Minister Antonis Samaras secured support from a majority of lawmakers for the 2013 budget that’s needed to unlock international bailout funds. The yen weakened against most of its major peers after data today showed Japan’s economy contracted in the third quarter at the fastest pace since last year’s record earthquake as exports slumped and consumer spending slid.
“The finance ministers’ meeting today will likely see more delays for Greece,” said Mike Jones, a currency strategist at Bank of New Zealand in Wellington. “All that uncertainty and delay have the potential to further unsettle investors and weigh on the euro.”
The euro traded at $1.2723 as of 11:43 a.m. in Tokyo from $1.2714 at the close on Nov. 9, when it touched $1.2690, the lowest since Sept. 7. The currency fetched 101.12 yen from 101.05, after last week dropping 2.1 percent, the sharpest decline since July. The yen was little changed at 79.48 per dollar.
Euro-area finance ministers will meet at 5 p.m. in Brussels. While ministers probably won’t approve 31.5 billion euros ($40 billion) in fresh loans to Greece, the maturing of 5 billion euros of Greek bills on Nov. 16 won’t lead to an “accidental default,” a European official said last week.
The vote was the second in five days after lawmakers approved an austerity bill on Nov. 8 containing economic reforms and 13.5 billion euros of austerity measures demanded.
“People may be buying back the euro a bit on the news that Greece passed the budget,” said Kumiko Gervaise, an analyst at Gaitame.com Research Institute Ltd. in Tokyo. “But it doesn’t necessarily mean that we can expect a smooth decision on the aid.”
Futures traders increased their bets that the euro will decline against the dollar for a third week, figures from the Washington-based Commodity Futures Trading Commission show.
In Japan, GDP fell an annualized 3.5 percent in the three months through September, after a revised 0.3 percent gain the previous quarter, the Cabinet Office said in Tokyo today. The median of 23 estimates in a Bloomberg News survey was for a 3.4 percent drop.
The world’s third-largest economy will probably shrink at an annual pace of 0.4 percent this quarter, according to the median forecast of 24 economists surveyed by Bloomberg. That would be the third technical recession since 2008. Japanese recessions are officially defined by a government-charged panel that considers data beyond GDP figures.
“We’re seeing a bit of yen selling against its crosses,” said Lee Wai Tuck, currency strategist at Forecast Pte in Singapore. “There is some concern that Japan may be falling into recession.”
Australia’s dollar rose after a bigger-than-estimated trade surplus in China brightened prospects for commodity exports, and data today showed Australian home-loan approvals rose for a second month.
China’s customs administration said Nov. 10 the nation’s exports exceeded imports by $32 billion in October, compared to a $27.3 billion trade surplus estimated by economists surveyed by Bloomberg. China is Australia’s biggest trading partner.
In Australia, the number of loans granted to build or buy houses and apartments rose 0.9 percent in September from the previous month, when it grew by a revised 2.1 percent, the statistics bureau said in Sydney today.
The so-called Aussie climbed 0.3 percent to $1.0422.
To contact the reporters on this story: Monami Yui in Tokyo at myui1@bloomberg.net; Kristine Aquino in Singapore at kaquino1@bloomberg.net
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
The 17-nation euro remained lower versus the yen, following its biggest weekly loss in four months, even after Greek Prime Minister Antonis Samaras secured support from a majority of lawmakers for the 2013 budget that’s needed to unlock international bailout funds. The yen weakened against most of its major peers after data today showed Japan’s economy contracted in the third quarter at the fastest pace since last year’s record earthquake as exports slumped and consumer spending slid.
“The finance ministers’ meeting today will likely see more delays for Greece,” said Mike Jones, a currency strategist at Bank of New Zealand in Wellington. “All that uncertainty and delay have the potential to further unsettle investors and weigh on the euro.”
The euro traded at $1.2723 as of 11:43 a.m. in Tokyo from $1.2714 at the close on Nov. 9, when it touched $1.2690, the lowest since Sept. 7. The currency fetched 101.12 yen from 101.05, after last week dropping 2.1 percent, the sharpest decline since July. The yen was little changed at 79.48 per dollar.
Euro-area finance ministers will meet at 5 p.m. in Brussels. While ministers probably won’t approve 31.5 billion euros ($40 billion) in fresh loans to Greece, the maturing of 5 billion euros of Greek bills on Nov. 16 won’t lead to an “accidental default,” a European official said last week.
Budget Vote
Samaras secured the vote on Greece’s 2013 budget with 167 lawmakers, setting up the next tranche of an international bailout. The nation’s fiscal plan, which forecasts a deficit of 5.2 percent of gross domestic product and a sixth year of contraction, is designed to regain the confidence of its euro- area and International Monetary Fund creditors.The vote was the second in five days after lawmakers approved an austerity bill on Nov. 8 containing economic reforms and 13.5 billion euros of austerity measures demanded.
“People may be buying back the euro a bit on the news that Greece passed the budget,” said Kumiko Gervaise, an analyst at Gaitame.com Research Institute Ltd. in Tokyo. “But it doesn’t necessarily mean that we can expect a smooth decision on the aid.”
Futures traders increased their bets that the euro will decline against the dollar for a third week, figures from the Washington-based Commodity Futures Trading Commission show.
Net Shorts
The difference in the number of wagers by hedge funds and other large speculators on a decline in the euro compared with those on a gain -- so-called net shorts -- was 67,141 on Nov. 6, compared with net shorts of 58,204 a week earlier.In Japan, GDP fell an annualized 3.5 percent in the three months through September, after a revised 0.3 percent gain the previous quarter, the Cabinet Office said in Tokyo today. The median of 23 estimates in a Bloomberg News survey was for a 3.4 percent drop.
The world’s third-largest economy will probably shrink at an annual pace of 0.4 percent this quarter, according to the median forecast of 24 economists surveyed by Bloomberg. That would be the third technical recession since 2008. Japanese recessions are officially defined by a government-charged panel that considers data beyond GDP figures.
“We’re seeing a bit of yen selling against its crosses,” said Lee Wai Tuck, currency strategist at Forecast Pte in Singapore. “There is some concern that Japan may be falling into recession.”
Worst Performance
The yen has declined 4.9 percent this year, the worst performance among the 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The dollar has fallen 1.3 percent while the euro has weakened 3.4 percent.Australia’s dollar rose after a bigger-than-estimated trade surplus in China brightened prospects for commodity exports, and data today showed Australian home-loan approvals rose for a second month.
China’s customs administration said Nov. 10 the nation’s exports exceeded imports by $32 billion in October, compared to a $27.3 billion trade surplus estimated by economists surveyed by Bloomberg. China is Australia’s biggest trading partner.
In Australia, the number of loans granted to build or buy houses and apartments rose 0.9 percent in September from the previous month, when it grew by a revised 2.1 percent, the statistics bureau said in Sydney today.
The so-called Aussie climbed 0.3 percent to $1.0422.
To contact the reporters on this story: Monami Yui in Tokyo at myui1@bloomberg.net; Kristine Aquino in Singapore at kaquino1@bloomberg.net
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
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