Euro adds to broad gains, hits 2-mth high vs dollar

July 10, 2010 By Leave a Comment

July 9 (Reuters) – The euro hit a two-month high against the dollar and rose broadly on Friday as improving risk demand prompted European banks to pick up the currency.

The euro EUR= climbed as high as $1.2723 according to electronic trading platform EBS. London traders cited demand from a Swiss bank from around $1.2680 as helping to push the single currency higher.

It rose broadly, climbing to 112.69 yen EURJPY= and 83.84 pence against sterling EURGBP=D4, its highest versus both currencies since June 21. (Reporting by Naomi Tajitsu)

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Euro hits all-time low vs Swiss franc

June 30, 2010 By Leave a Comment

June 29 (Reuters) – The euro hit an all-time low against the Swiss franc on Tuesday as funding concerns about the euro zone prompted investors to shift their funds to the safe-haven Swiss currency.

The euro fell 0.2 percent on the day to 1.3323 francs EURCHF=R on trading platform EBS, the weakest since its 1999 launch.

(Reporting by Rika Otsuka)

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Euro hits all-time low vs Swiss franc

June 30, 2010 By Leave a Comment

June 29 (Reuters) – The euro hit an all-time low against the Swiss franc on Tuesday as funding concerns about the euro zone prompted investors to shift their funds to the safe-haven Swiss currency.

The euro fell 0.2 percent on the day to 1.3323 francs EURCHF=R on trading platform EBS, the weakest since its 1999 launch.

(Reporting by Rika Otsuka)

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Danes turns ever colder towards euro, poll shows

June 25, 2010 By Leave a Comment

June 24 (Reuters) – Danish resistance to swapping Denmark’s crown currency for the euro is stronger than ever, a new opinion poll for Danske Bank (DANSKE.CO) showed on Thursday.

The “No” camp’s lead grew to 11.3 percentage points in June, Danske Bank said, adding that there was little chance of a Danish vote on the euro this side of the next general elections due to be held before the end of November 2011.

Opposition to the euro increased to 54.6 percent in June from 47.4 percent in a similar poll in March.

“This is the largest ‘No’ lead since we launched our EMU poll in 1999,” the bank said in a research note to clients.

Danes rejected the euro in a referendum in 2000, instead pegging the crown to the single European currency within a narrow band EURDKK=. The financial crisis brought a brief groundswell of support for the euro, but that has now vanished.

Looking solely at those who were certain how they would vote, the ‘No’ side had an even more solid lead.

Only 32.1 percent of Danes polled were certain they would vote “Yes”, while 47.8 percent were certain ‘No’ voters — a difference of 15.7 percentage points, Danske Bank said.

“Comparing the results against our last survey in March 2010, the most noticeable shift is in the number of certain ‘No’ voters,” it said.

Furthermore, the Danish central bank’s interest rate cuts have narrowed the official interest rate spread to the euro zone to just 5 basis points over the past year.

“This makes the cost of not being a euro member appear considerably less than it did just 1.5 years ago, when the rate spread briefly rose to 175 bps,” Danske Bank said.

It remains uncertain when Danes might vote again on adopting the euro, Danske Bank said, adding that a referendum would be no easy matter politically for the current centre-right government which favours the euro.

It said there was a big risk that a vote would go against the government, and it noted that the government’s majority in parliament depends on the support of the Danish People’s Party, which opposes the euro.

“Therefore, the government will probably not call a referendum until after the next general election, which is due to take place by November 2011,” Danske Bank said.

Another opinion poll earlier this month by TNS Gallup found that only 36.3 percent would vote for the euro in a referendum while 54.8 percent would vote against, and 8.9 percent in the survey had no opinion [ID:nLDE65F0CI]. (Reporting by John Acher, editing by Mike Peacock)

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FOREX-Euro, Aussie pare post-yuan fixing gains

June 23, 2010 By Leave a Comment

TOKYO, June 22 (Reuters) – The euro slipped on Tuesday, giving back gains made after China set the yuan’s mid-point at its highest since the yuan’s revaluation in 2005, as players wondered how fast the Chinese authorities would let their currency rise.

The euro and the Australian dollar hit their highs for the day after China’s central bank set the yuan’s daily mid-point at 6.7980 against the dollar, stronger than Monday’s 6.8275 per dollar. Traders took it as a sign it could allow the yuan to rise further.

The rise in the euro and the Australian dollar was short-lived, however, as spot yuan CNY=CFXS eased against the dollar after soaring to its highest level since its July 2005 revaluation.

“The euro and the Aussie slipped simply because the yuan eased, with some players suspecting Chinese authorities might be intervening to rein in the yuan’s rise,” said a senior FX trader at a big Japanese brokerage.

The market took the yuan 0.42 percent higher on Monday, its biggest one-day rise since the 2005 revaluation. But dealers fear the central bank will not let the market keep boosting the yuan at the pace seen the previous day.

The euro EUR= dipped 0.1 percent to $1.2298, off the day’s peak of $1.2355. It hit a one-month high of $1.2490 on trading platform EBS on Monday after China pledged to allow the yuan to rise, boosting confidence in the global economy.

Near-term support was seen at $1.2253, a 38.2 percent Fibonacci retracement of the rise from a four-year low of $1.1875 on June 7 to Monday’s high of $1.2490.

On the other hand, the dollar index .DXY was up 0.1 percent at 86.01, holding well above support at 85.13. The index posted a bullish reversal on Monday, suggesting more gains for the greenback in the near term.

Beijing’s vow of flexibility for the yuan, which should boost purchasing power and demand in the the world’s third-largest economy, had initially fuelled a rally in risky assets on Monday.

But the rally ebbed with not much follow-through buying, with China’s move undertaken primarily for political purposes, analysts said. Leaders of the Group of 20 leading industrialised and developing economies are to meet next week in Toronto, where global trade imbalances are expected to be a key issue.

China on Monday ruled out a one-off revaluation and said it will reform its exchange rate regime in a gradual manner. [ID:nBJC002566]

“The Chinese decision provided a welcoming short-term distraction in a market gripped by fear and anxiety, but the underlying European fiscal headaches and global growth uncertainties remain unaltered,” wrote Matthew Strauss, currency strategist at RBC Capital.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Main yuan coverage [ID:nCHINATAKE]

Winners and losers from a firmer yuan [ID:nTOE65K02D]

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Some traders said they expect the yuan to be a short-term trading factor until a bigger trend comes to the market.

RBC’s Strauss said the euro’s failure to break past resistance near $1.25 was likely to result in a period for weakness for the single currency. Against the yen, the euro was down 0.3 percent at 111.94 EURJPY=R, having shed about 0.2 percent on Monday.

The euro in recent months has moved with swings in risk appetite. On Monday, the 25-day rolling correlation between the euro and the S&P 500 .SPX was at a robust 54 percent.

The fading risk rally was also evident in stock markets.

The Australian dollar AUD=D4, which had gained 1.4 percent in the previous session, was at $0.8785, with support at $0.8750 — Monday’s low — and strong resistance at Monday’s $0.8860 high.

The Aussie jumped to hit the day’s peak at $0.8834 after the yuan mid-point fixing. (Additional reporting by Anirban Nag in Sydney and Satomi Noguchi in Tokyo; Editing by Chris Gallagher)

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UPDATE 1-IMF says Poland right to delay euro adoption-paper

March 29, 2010 By Leave a Comment

WARSAW, March 29 (Reuters) – Poland was right to put off swapping its currency for the euro because the move gave it the flexibility to absorb the effects of the global crisis, the head of the IMF was quoted on Monday as saying.

“The Polish government’s decision to delay the euro adoption is correct right now,” the International Monetary Fund’s Dominique Strauss-Kahn told the Gazeta Wyborcza newspaper ahead of his visit to Poland on Monday.

“Poland should still set the adoption of the euro as its goal,” he said.

Poland’s centre-right government ditched plans to swap the zloty for the common currency in 2012 and no longer has a specific goal, although several officials have said the move would be possible in 2015.

A deputy finance minister said last month Poland will most likely reapply to the IMF to extend its $20.6 billion Flexible Credit Line (FCL), which it received a year ago in the midst of the financial crisis.

Poland managed to escape the global downturn mostly unscathed, emerging as the European Union’s lone member to dodge a recession. But the zloty fell as much as 30 percent in 2009 to the euro before regaining about 10 percent. (Reporting by Chris Borowski)

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IMF says Poland right to delay euro adoption-paper

March 29, 2010 By Leave a Comment

WARSAW, March 29 (Reuters) – Poland was right to put off swapping its currency for the euro because the move gave it the flexibility to absorb the effects of the global crisis, the head of the IMF was quoted on Monday as saying.

“The Polish government’s decision to delay the euro adoption is correct right now,” the International Monetary Fund’s Dominique Strauss-Kahn told the Gazeta Wyborcza newspaper ahead of his visit to Poland on Monday.

“Poland should still set the adoption of the euro as its goal,” he said. (Reporting by Chris Borowski; Editing by Tomasz Janowski)

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Nikkei slips as fear returns, banks and techs hit

April 23, 2009 By Leave a Comment

Nikkei down 3.4 pct, set to snap 3-day rising streak

* Surge in Bank of America loans revives financial fears

* Banks down, techs hit by weak IBM results

* Dollar claws back against yen after Monday fall

By Elaine Lies

TOKYO, April 21 (Reuters) – Japan’s Nikkei average lost 3.4 percent on Tuesday as a surge of bad loans at Bank of America revived fears about the U.S. financial system and economy, while a stronger yen hit exporters such as Canon Inc (7751.T). Banks fell, with tech shares also sliding in the wake of worse-than-expected results from IBM (IBM.N).

Toyota Motor Corp (7203.T) skidded 4.4 percent to 3,700 yen, after the Yomiuri newspaper said the company would likely produce about 6.2 million vehicles globally in the year to March 2010, down more than 12 percent amid a worldwide sales slump but roughly in line with expectations. [ID:nT30926]

The 41 percent climb in Bank of America’s (BAC.N) first-quarter non-performing assets raised concerns about the sustainability of recent better-than-expected results from banks and revived broad risk aversion, hitting equity markets and boosting the yen.

“The recent results had reassured people, but now they’re wondering if banks are really all right, especially as the announcement of results of the ‘stress tests’ draws nearer,” said Hideyuki Ishiguro, a supervisor at the investment advisory department of Okasan Securities.

“But even amid these worries there are some signs of improvement in the real economy, especially in China, and this will prevent sharp selling.”

The Obama administration is set to announce the outcome of the stress tests, assessing the ability of the country’s largest 19 banks to cope with potential strains, on May 4.

The dollar had clawed higher against the yen after falling 1.2 percent on Monday

The euro briefly fell to a one-month low of 126.10 yen before recovering, while the Australian dollar also fell against the Japanese currency.

“The euro and the Australian dollar had really fallen as risk aversion rises, and while the yen isn’t really strong, it too is benefiting from this,” said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities. “But basically the idea is that both Wall Street and the Nikkei have risen over the past few sessions, and it was time for a break anyway.”

Bank of America said on Monday its credit quality had deteriorated markedly, sending its shares plunging 24.3 percent. [ID:nN20380236]

The benchmark Nikkei .N225 lost 299.06 points to 8,625.69 and looked set to snap a three-day rising streak, while the broader Topix lost 3.3 percent to 820.18.

BANKS BOTHERED, TECHS TROUBLED

Mitsubishi UFJ Financial Group (8306.T), Japan’s largest bank, lost 3.4 percent to 479 yen, while second-ranked Mizuho Financial Group (8411.T) shed 3.1 percent to 191 yen. Sumitomo Mitsui Financial Group (8316.T) lost 3.3 percent to 2,930 yen.

Nomura Holdings (8604.T), Japan’s largest brokerage, fell 4.8 percent to 571 yen.

“In many ways, the worst for this round of earnings results is behind us, with both the Bank of America and Citigroup results out, and this has reassured the market over the short term,” said Mitsubishi UFJ’s Yamagishi.

“But there’s no question that over the longer term things could still be kind of tough.”

Tech shares slipped broadly, both on the weaker yen and after IBM (IBM.N) reported a larger-than-expected fall in quarterly sales. But in a sign of how difficult the market is to read, tech bellwether Texas Instruments (TXN.N) reported a small quarterly profit and better-than-expected revenue. [ID:nN20352411] [ID:nN20403813]

Kyocera Corp (6971.T) lost 2.4 percent to 6,800 yen and TDK Corp (6762.T) fell 2.3 percent to 3,890 yen. Panasonic Corp (6752.T) fell 2.6 percent to 1,328 yen and Canon Inc (7751.T) lost 5.8 percent to 2,910 yen.

Sony Corp (6758.T) tumbled 5.1 percent to 2,520 yen, while Honda Motor Corp (7267.T) lost 5.2 percent to 2,720 yen.

But KDDI Corp (9433.T) bucked the trend, rising 1.8 percent to 455,000 yen after the Nikkei business daily said Japan’s second-biggest wireless carrier is expected to report a 12 percent rise in operating profit to about 450 billion yen ($4.6 billion) for the business year ended March 31. [ID:nBNG423551]

Trade was moderate on the Tokyo exchange’s first section, with 1.1 billion shares changing hands, compared with last week’s morning average of 1.2 billion.

Declining stocks outnumbered advancing ones by nearly 17 to 1. ($1=98.04 Yen) (Editing by Michael Watson)

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