Yen firms up despite poor Japan GDP data
February 18, 2014, 12:19 am TWN
TOKYO--The yen strengthened in Asia Monday as investors shuffled their positions after weaker-than-expected Japanese growth figures dented confidence in Prime Minister Shinzo Abe's policy blitz, dubbed Abenomics.
In afternoon Tokyo trade, the dollar slipped to 101.58 yen, from 101.81 yen in New York Friday afternoon, with the yen winning support from expectations that the Bank of Japan (BoJ) would hold fire on new easing measures after a two-day policy meeting.
The euro inched down to 139.25 yen and US$1.3708 from 139.42 yen and US$1.3715 in U.S. trade, after data Friday showed that a modest recovery in the eurozone economy remains on track.
In Japan, the economy logged its best performance in three years, expanding 1.6 percent, as Abe's growth blitz drove the expansion, but weak second-half data and a looming April sales tax rise dampened the outlook for strong growth this year.
The world's third-largest economy expanded just 0.3 percent between October and December, data showed Monday.
Abe's growth policy has boosted Japanese stocks and driven down the yen's value, but investors were “discouraged by the recent drops in stock prices and today's weaker-than-expected GDP data,” said Shuichi Kanehira, head of spot forex trading at Mizuho Bank.
There has been speculation that the BoJ will expand its easy-money policies later this year, but policymakers are widely expected to hold off fresh measures after the BoJ wraps up its meeting Tuesday. Easing measures tend to weigh on a currency.
The dollar also fell against Asia-Pacific currencies.
The greenback fell to 11,692 rupiah from 11,920 rupiah on Friday, to 44.54 Philippine pesos from 44.83 pesos, and to 32.35 Thai baht from 32.53 baht.
It also sank to SG$1.2597 from SG$1.2652, and to 1,061.83 South Korean won from 1,063.28 won, and to 62.06 Indian rupees from 62.35 rupees.
The Australian climbed to 90.49 U.S. cents from 89.94 cents, while the Chinese yuan fetched 16.72 yen against 16.75 yen.