Jessop sees two drivers of further yen weakness: expectations the Bank of Japan (BOJ) will expand its quantitative easing program, possibly as soon as next month, and a Fed hike.
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Japan’s Nikkei stock index was up 0.2 percent in early afternoon trading, sharply paring its morning gains. The Shanghai Composite Index was down 2.4% and the CSI300 index was 2.6% lower.
The euro gave up about 0.2 percent to 135.72 yen, while it was steady against the dollar at $1.1315. It lost $1.77 on Monday to close at $46.37 a barrel in London. Republication or redistribution of content provided by EconoTimes is expressly prohibited without the prior written consent of EconoTimes, except for personal and non-commercial use.
While Sydney stocks retreated, the “Aussie” dollar was given a boost by news that the popular Malcolm Turnbull would replace Tony Abbott as Australian prime minister after a Liberal Party coup on Monday.
Traders have scaled back bets that the Federal Open Market Committee, the Fed’s policy-setting group, will end its near-zero rate policy on Thursday as this summer’s global market turmoil over concerns about the Chinese economy may have overshadowed further improvement in the US labor market.
Asian shares mostly retreated Tuesday as China’s malaise keeps investors on edge ahead of a United States interest rate decision later this week, while Tokyo rallied on hopes for fresh measures to shore up the torpid Japanese economy. More signs of slowing economic growth in China weighed on prices for copper and other commodities, driving stocks of raw-material producers down. If the Fed delays a rate hike and that causes the dollar to fall, it may trigger a yen spike and hurt already weak exports by making Japanese goods less competitive overseas, they argue. “But there’s no change to our view that Japan’s economy continues to recover moderately”, Kuroda told reporters on Tuesday after a policy meeting. Monday authorities announced they had started their crackdown on thousands of stock accounts that are linked to illegal trading, in the government’s latest bid of restoring order to the markets that have been pummeled by a rout, which has wiped off trillions in market valuations over the last three months. It lost 63 cents to close at $44 a barrel on Monday. Apple climbed $1.10, or 1 percent, to $115.31. Brent Crude, a benchmark for global oils, fell 3 cents to $48.22.
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He predicted Japan s economy, the world s third-largest, would return to growth in the current quarter, arguing that the 0.3 percent shrinkage in April-June was a “one-off” case.
