Thursday October 2, 2014 Search
Weather | Athens
28o C
16o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Yen jumps, euro drops on the US fiscal fear, Greece debt doubt

The yen soared and the euro moved away from the previous session's one-month high against the dollar in Asian trading Wednesday as investors' relief about a new debt target for Greece turned to unease over the looming U.S. fiscal crisis.

The U.S. Congress pushed toward compromise on Tuesday on the «fiscal cliff» of tax increases and spending cuts due to take effect from early next year, but an agreement still appeared elusive despite growing pressure from American business interests for action.

Comments by U.S. Senate Majority Leader Harry Reid on Tuesday about the lack of progress by Democratic and Republican lawmakers also fanned concerns.

Investors unwound long dollar and euro positions against Japan's currency. The yen had lost about 4 percent against the dollar over the past two weeks as investors started to price in a possible shift in monetary policy after Japan's December 16 election. Shinzo Abe, likely to emerge as the country's next leader, has called for more aggressive easing.

"Worries about the U.S. fiscal cliff have increased, while the effects of the 'Abe trade' have faded for now,» said Masashi Murata, senior forex strategist at Brown Brothers Harriman. «The market wants to see what the Bank of Japan actually does,» he said.

Disappointment about the lack of details in the Greece deal added to pressure on the euro. While international lenders agreed on a plan to cut Greek debt, which will allow the country to secure more financial aid and avoid a chaotic default, market skepticism grew over a lack of detail on how Athens will implement the reforms needed to meet its new targets.

"The purpose of the meeting was supposed to have been not to just give Greece additional funding, but to consider the evidence that Greece deserved to receive additional funding,» said Kimihiko Tomita, head of foreign exchange for State Street Global Markets in Tokyo.

"This purpose was not fulfilled, which is why the euro buying has halted,» he said.

Europe's «muddle-through approach» on Greece threatens to amplify the outcome of the U.S. fiscal talks on the euro, strategists at Barclays wrote in a note to clients on Wednesday.

"If they go well, the relief on peripheral assets may have legs, including the euro. If it goes bad, even France may get questioned by an uncertain market, and we would expect the euro to suffer,» they said.

The euro had been in a rising trend against the dollar since last week, as investors' hopes rose that a deal on Greece would be reached and that U.S. lawmakers would make progress on addressing the fiscal impasse. The single currency rose as high as $1.3010 on Tuesday on trading platform EBS, its highest level since late October.

The euro was down about 0.2 percent in Asia at $1.2920, after earlier breaking below support at its 55-day moving average at $1.2918. Support was also cited at the 38.2 percent Fibonacci retracement of its recent rally at $1.2877.

The European unit also skidded 0.6 percent to 105.69 yen, moving away from a seven-month high of 107.135 yen set on Monday. Stop-loss orders were said to be placed around 105.50 yen.

The dollar dropped about 0.4 percent to 81.81 yen, moving away from a 7-1/2 month high of 82.84 yen reached last Thursday.

The dollar got no help from starkly diverging messages from U.S. Federal Reserve officials on Tuesday. Charles Evans, president of the Chicago Federal Reserve and one of the Fed's most outspoken doves, said interest rates should stay near zero until the jobless rate falls to at least 6.5 percent.

But Dallas Fed President Richard Fisher said the U.S. central bank needs to not set a limit on the amount of assets it is willing to buy.

[Reuters]

ekathimerini.com , Wednesday November 28, 2012 (09:52)  
Attica Bank said to have rejected notable offers
PMI index slides anew in September
Costa Navarino to host big events
Construction of F1 circuit at Patra to start by year-end
Terror group link prompts police raids and arrests
Police found a Kalashnikov assault rifle, a handgun, a hand grenade and numerous bullets Wednesday while searching homes in Athens and Thessaloniki used by six people who were detained and a...
Samaras to seek confidence vote in bid to rally coalition
The government said on Wednesday that it will request a vote of confidence when Parliament reconvenes after the summer recess next week, seeking to douse speculation about early elections an...
Inside News
SOCCER
Rosenberg punishes Olympiakos´s errors at Malmoe
A disappointing Olympiakos got the worst possible result from its clash with Malmoe in Sweden for the Champions League, going down 2-0 on Wednesday due to its own defensive errors and attack...
SOCCER
All team sports suspended next weekend in memory of dead fan
The government announced on Monday the suspension of all team sports events in Greece scheduled for next weekend, October 4 and 5, in the memory of the Ethnikos Piraeus fan who died a few ho...
Inside Sports
COMMENTARY
Truth before the battle
The coalition has lost its sense of direction in the last few months. Exactly where things went off track is not the question at this stage. What is certain is that if it continues competing...
EDITORIAL
Bending the rules
The flexibility with which laws are implemented has been a fundamental cause for concern in Greece during the post-dictatorship era. Everything becomes a subject for negotiation, even in cas...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Rosenberg punishes Olympiakos´s errors at Malmoe
2. Terror group link prompts police raids and arrests
3. Samaras to seek confidence vote in bid to rally coalition
4. Attica Bank said to have rejected notable offers
5. PMI index slides anew in September
6. Costa Navarino to host big events
more news
Today
This Week
1. Air-raid sirens to go off all over Greece at 11 a.m. in drill
2. Mario Draghi to push ECB to buy Greek, Cypriot 'junk' loans: FT
3. Truth before the battle
4. Smallpox decimates sheep stocks in northern Greece
5. Thessaloniki transport gets more expensive
6. Bending the rules
Today
This Week
1. Greece may opt for unusual president to avoid snap polls, Venizelos says
2. Woman allegedly buried alive by accident in northern Greece
3. Salaries in Greece continue to slide, dipping 1.4 pct in Q2
4. Should you bet with Kissinger on where the world is heading?
5. Cypriots divided by 1974 war seek Shariah hub
6. The shocking thought of euro-dollar parity
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.