craiglist los angeles -: Japanese Yen Sold as China Premier Wen Stokes Stimulus Hopes

Japanese Yen Sold as China Premier Wen Stokes Stimulus Hopes

Talking Points

• Japanese Yen Broadly Sold as China’s Wen Drives Risky Assets Higher
• US Dollar Lower Holds Ground as G8 Summit Yields Little on Eurozone
• SP 500 Stock Index Futures Hint Sentiment Likely to Recover Further

The Japanese Yen underperformed in overnight trade as stocks rose in Asia and dampened demand for the safe-haven currency. The MSCI Asia Pacific regional benchmark equity index rose 0.3 percent after Chinese Premier Wen Jiaobao said Beijing will maintain an active fiscal policy focused on stabilizing economic growth. The comments underpinned risk appetite on hopes that China will undertake stimulus measures to boost its own performance and by extension that of the global economy at large.

The likewise safety-linked US Dollar (ticker: USDollar) likewise faced selling pressure against growth-geared currencies like the Canadian and New Zealand Dollars. The benchmark currency remained well-supported versus its European counterparts however after the weekend’s G8 summit produced nothing concretely supportive on Greece or the wider Eurozone crisis.

Looking ahead, the economic calendar is relatively quiet through European and US trading hours, leaving risk sentiment trends broadly in control of price action. SP 500 stock index futures are pointing higher late into the overnight session, hinting the recovery in risky assets may have scope to continue at the expense of the greenback and the Japanese unit.

Asia Session: What Happened

Euro Session: What to Expect

Critical Levels

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

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