Yen Declines Against Most Majors

Yen Declines Against Most Majors




The Japanese yen weakened against most of its major rivals in early European trading on Tuesday despite a fall in European equities.
European shares are trading mostly lower, in tandem with its Asian peers, as concerns about the strength of Chinese demand pulled down commodity prices and increased demand for the greenback.
A lack of fresh catalysts to trigger yet another wave of buying and a flat reading on U.S. home-builder sentiment following five straight increases also prompted investors to move to the sidelines ahead of Federal Reserve chairman Ben Bernanke's speech tonight.
Thus far, the U.K. FTSE 100 index slipped 0.57 percent, France's CAC-40 index fell to 1.05 percent and Germany's DAX dropped 0.64 percent.
The yen reached to a 4-day low of 83.84 against the dollar, down by more than 80-pips from yesterday's 5-day high of 83.03. The immediate support for the yen is seen around the 84.0 level.
The yen is poised to touch the psychological mark of 133.0 versus the pound in early trading, hitting as low as 132.98 before holding steady around 5:05 am ET.
U.K. annual inflation slowed further in February to the lowest level since November 2010, data from the Office for National Statistics showed today.
Consumer price annual inflation slowed to 3.4 percent in February from 3.6 percent in January. Nevertheless, the inflation figure remained slightly above the 3.3 percent forecast by economists. It was also clearly above the central bank's 2 percent target.
Month-on-month, consumer prices rose 0.6 percent after a 0.5 percent fall in January. Core inflation slowed to 2.4 percent from 2.6 percent. Economists expected a slowdown to 2.3 percent.
The Japanese currency reached near the key 92.0 level against the Swiss franc, hitting as low as 91.92 for the first time since the SNB intervention on September 6, 2011. On the downside, the yen may find support around the 94.40 level, where the 50 percentage retracement levels lie in the pair.
Production in the Swiss industrial sector decreased from last year in the fourth quarter, data released by the Federal Statistical Office showed today.
Industrial output decreased 1.4 percent year-on-year in the fourth quarter, after a revised 1.9 percent decline in the third quarter. Economists expected output to drop 2 percent.
The yen reached nearly a 5-month low of 110.85 against the euro around 5:00 am ET. The yen then erased some of its losses shortly thereafter and is presently hovering around the 110.50/60 area per euro.
Germany's producer price inflation eased for the fifth month to a 20-month low in February, data from the Federal Statistical Office showed today.
The producer price index increased 3.2 percent annually in February in line with economists' expectations, slower than the 3.4 percent rise in January.
Month-on-month, producer prices edged up 0.4 percent in February, after rising 0.6 percent in January. Economists were looking for a 0.5 percent gain on a monthly basis in February.
The yen that fell to a 5-day low of 84.72 against the Canadian dollar around 5:00 am ET recovered some of its losses shortly thereafter. The loonie-yen pair is presently quoted at 84.50/55.
Against its Tasman counterparts, the yen traded higher in early deals on Tuesday, hitting as much as 87.89 against the Australian dollar and 68.48 against the New Zealand dollar by 5:45 am ET.
Minutes from the Reserve Bank of Australia's March 6 meeting released today showed that the board members are content with the latest inflation and unemployment data in Australia.
At the meeting, the RBA kept its benchmark cash rate unchanged at 4.25 percent for a second consecutive month - calling the figure appropriate.
The board added that the greatest threat for Australia would be the deterioration of economic conditions in Europe. While the risk from Europe had diminished somewhat, the board noted, it remains a major threat to the Australian economy - as does a slowdown in Asia.
Looking ahead, the U.S. housing starts and building permits for February is due in the New York morning session.

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