Japan stocks rally, yen resumes fall after G20
Japanese shares jumped closer to a 33-month high as the yen slumped on Monday after Tokyo dodged direct criticism from G20 peers on the aggressive reflation plans that have weakened the currency.
The G20 opted not to single out Tokyo, but committed members to refrain from competitive devaluations and said monetary policy would be directed only at price stability and growth. Japan said this decision is a green light to pursue its expansionary policies.
The dollar soared 0.7 percent to 94.17 yen inching closer to its highest since May 2010 of 94.465 hit on Feb. 11. The euro added 0.3 percent to 125.51 yen, still below its peak since April 2010 of 127.71 yen touched on Feb. 6.
The Nikkei average jumped 2.3 percent as exporters and banks led the pack on the softening yen.
The market's focus is now on Prime Minister Shinzo Abe's nominee for the next Bank of Japan governor. Abe is expected to announce his choice in coming days.
Sources told Reuters that former top financial bureaucrat Toshiro Muto is leading the field of candidates to govern the bank. He is expected to intensify stimulus efforts to energise the economy.
"The G20's message is that monetary easing is OK, but not to imply anything about leading a currency weaker. The G20 effect is already seen in Abe's general comments on forex today which steered away from giving specifics on a preferred level or direction for the yen," said Yunosuke Ikeda, a senior FX strategist at Nomura Securities.
Abe said on Monday
Be the first to comment.
