Euro stops slid against Yen after Netherlands sold 2 billion euros of bonds. Netherlands sale managed to give boost Euro performance against Yen after halted its biggest slide in two weeks. Details!!!!!
Euro Snaps Decline Against Dollar After Netherlands Sale
The euro halted its biggest slide in two weeks against the yen as the Netherlands sold 2 billion euros ($2.6 billion) of bonds, easing concern the debt crisis is spreading to the region’s strongest economies.
Europe’s shared currency gained versus most of its 16 major peers before Dutch Prime Minister Mark Rutte speaks in parliament today, less than 24 hours after tendering his Cabinet’s resignation. The yen slid on speculation the Bank of Japan (8301) will announce further monetary easing policies on April 27. Sweden’s krona strengthened against all its most-traded counterparts after unemployment unexpectedly fell in March for a second month.
“The Dutch auction got away without a serious hitch, which is good news for the euro,” said Jeremy Stretch, head of currency strategy at Canadian Imperial Bank of Commerce in London. “People are mindful of the BOJ meeting at the end of the week, which is stopping them from going too much into the yen.”
The euro traded at 106.90 yen at 6.57 a.m. New York time, from 106.81 yen yesterday, when it slid 0.9 percent, the steepest decline since April 10. The Japanese currency was also little changed, at 81.24 per dollar after rising as much as 0.4 percent. The euro traded little changed at $1.3164. It fell 0.5 percent yesterday, the biggest drop since April 13.
Dutch bonds gained as the Netherlands sold 1 billion euros of 3.75 percent notes due 2014 at an average yield of 0.523 percent and 995 million euros of 4 percent bonds maturing in 2037 at an average yield of 2.782 percent.
Rutte will speak during a debate in parliament in the Hague in a bid to break a budget deadlock over additional cuts of at least 9.5 billion euros needed to comply with European deficit limits. He offered to quit after budget talks with Geert Wilders’s Freedom Party collapsed.
The BOJ is “committed” to monetary easing, Governor Masaaki Shirakawa said last week in New York. Deputy Governor Kiyohiko Nishimura said on April 18 the BOJ is “committed to implementing additional easing measures, if deemed necessary.”
The yen fell the most in more than three months against the dollar on Feb. 14 after the central bank unexpectedly expanded bond purchases by 10 trillion yen and set a 1 percent inflation goal. It left stimulus unchanged at its next two meetings.
The yen has slipped 8 percent this year, the worst performer of the 10 developed-nation currencies tracked by Bloomberg Correlation Weighted Indexes. The dollar has declined 2.3 percent and the euro has weakened 0.6 percent.
Swedish unemployment fell to 7.7 percent from 7.8 percent in February, the Stockholm-based statistics office said today. The rate was predicted to rise to 8 percent, according to the median estimate of 10 economists surveyed by Bloomberg.
The krona strengthened 0.2 percent to 8.8733 per euro, and advanced 0.2 percent to 6.7411 per dollar.
Australia’s dollar fell after a government report showed consumer prices rose 1.6 percent in the first quarter from a year earlier, the slowest pace since 2009.
Central bank Governor Glenn Stevens signaled on April 3 he may end a three-month pause in interest-rate cuts as soon as next month if weaker-than-forecast growth slows inflation.
The so-called Aussie dropped 0.3 percent to $1.0292 after falling to $1.0247, the weakest since April 11.
Aussie to Drop
The currency may decline to 82 yen after forming a “head- and-shoulders” pattern on its price chart, said Pak Lai Ng, Singapore-based technical analyst at Forecast Pte. The formation was completed after the currency’s price movement formed three peaks on March 2, March 19 and March 27, he said.
A head-and-shoulders pattern appears when a currency makes three consecutive peaks, with the middle being the highest.
The Aussie weakened 0.3 percent to 83.51 yen. It last traded at 82 yen on Feb. 6.
The U.S. Federal Open Market Committee begins a two-day meeting today and is scheduled to release a statement on monetary policy along with its projections for growth, unemployment and inflation tomorrow. All 79 economists surveyed by Bloomberg News estimate the Fed will keep its benchmark rate in a range of zero to 0.25 percent. (David Goodman – Bloomberg)