BLBG:Euro Drops to Five-Week Low Versus Yen Before Unemployment Data
The euro weakened to a five-week low versus the yen before a report that economists said will show the unemployment rate in the 17-nation currency bloc climbed to a record in February.
The yen advanced versus 14 of its 16 major peers as investors weighed the chances of new stimulus from the Bank of Japan (8301) at a two-day meeting starting tomorrow. The dollar depreciated past 93 yen for the first time in a month before data this week that is forecast to show the recovery in the U.S. job market isn’t fast enough to prompt the Federal Reserve to reduce monetary stimulus. Australia’s dollar rose after the nation’s Reserve Bank said existing stimulus is working.
The euro dropped 0.3 percent to 119.44 yen at 8:27 a.m. London time after declining to 119.16, the least since Feb 26. The common currency gained 0.1 percent to $1.2859. The yen appreciated 0.4 percent to 92.89 per dollar after climbing to 92.57, the strongest since March 1.
Unemployment in the euro region climbed to a record 12 percent in February, according to the median of 31 economist estimates in a Bloomberg survey. A separate report is forecast to show manufacturing in the region contracted for a 20th month in March.
The euro also weakened as Cyprus government officials said they would seek easier bailout terms in talks with representatives of the European Union and International Monetary Fund today, before a meeting of euro-area finance officials later this week.
BOJ Governor Haruhiko Kuroda said the central bank will do whatever it can to beat deflation and that it will conduct bold monetary easing. He spoke in parliament today before leading his first policy meeting since taking over from Masaaki Shirakawa last month. The BOJ board will convene twice this month, with another meeting scheduled on April 26.
The euro dropped 1.7 percent in the past month according to Bloomberg Correlation-Weighted Indexes. The yen climbed 0.5 percent, while the dollar dropped 0.4 percent.
To contact the reporter on this story: Neal Armstrong in London at narmstrong8@bloomberg.net
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
