Thu, 23 May 2013 02:49:54

South Korea's economic problems aren't made in Japan.

That isn't the way it looks in the two rival exporters' stock markets. Investors convinced that Japan's weakening yen will help its companies claw global market-share back from Korean competitors have bought almost $75 billion worth of Japanese stocks so far this year. Part of that appears to have come at the expense of South Korea, where foreign investors have sold nearly $6 billion of shares. Japan's benchmark stock index has thus soared 50 percent this year on hopes Prime Minister Shinzo Abe can revive the economy and with it the fortunes of big exporters such as Toyota Motor Corp and Panasonic Corp. Stocks in Seoul have meanwhile stagnated, with Samsung Electronics Co Ltd down around 1 percent. The problem for Korea had seemed obvious: while the yen has slid 20 percent against the dollar over the past year, the won has climbed by a third against the Japanese currency. In theory, that makes Korea's exports more expensive relative to Japan's, enabling Japanese companies to un..

 

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Tue, 21 May 2013 03:58:10

Dollar resumes rise against yen, Bernanke key to more

The dollar rose against the yen on Tuesday after a Japanese minister clarified remarks about the yen's drop, but many awaited the Federal Reserve chief's testimony before adding to bets on a stronger U.S. currency. Speculation the Fed will trim its bond purchases sooner than expected has mounted given signs of an improvement in the U.S. labour market. Chairman Ben Bernanke testifies to Congress on Wednesday and his words will be combed for clues on the timing. If Bernanke reiterates his ultra-loose monetary policy stance, the dollar could give up some of its gains against most major currencies. However, any hint asset purchases could be wound down later this year would give the dollar index, which has risen 5 percent this year, a huge boost, traders said. The index, which measures the dollar against a basket of six currencies, was up 0.12 percent at 83.839, not far from Friday's peak of 84.371, its highest since July 2010. The dollar was up 0.3 percent at 102.65 yen after Japane..

 

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Mon, 20 May 2013 06:47:45

Yen edges up on minister's comments, could dip again

 The yen rose from a 4-1/2-year low against the dollar on Monday after Japan's economy minister suggested the country's currency might have weakened enough, leading some investors to cut hefty bets against it. The dollar fell 0.6 percent to 102.55 yen, having slid about 1 percent to 102 in the Asian session. The euro lost 0.5 percent to 131.85 yen after plumbing 131.045. Last Friday, the dollar reached a 4-1/2-year high of 103.32 yen, while the euro hovered near a 3-1/2-year peak of 132.78 yen. But analysts said any sharp dip in the dollar against the yen was a buying opportunity even after Economy Minister Akira Amari said the yen's excessive strength has largely corrected and further weakness could damage Japan's economy. The Bank of Japan holds a policy meeting on Tuesday and Wednesday. "Dollar/yen had overshot both from a technical as well as from the extreme short positioning that had seen against the yen," said Alvin Tan, currency strategist at Societe Generale. ..

 

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Thu, 16 May 2013 21:27:10

Stronger currency enhances appetite for dim sum

Despite recent volatility in the offshore yuan market, the demand for bonds denominated in the Chinese currency is likely  to remain strong as the yuan's appreciation trend looks intact.   An HSBC index measuring total returns in the dim sum bond market has gained more than 1.5 percent this year. That beats  returns in the Chinese onshore bond market by more than one percentage point and is about even with how Hong Kong's generally weak stock market has fared in 2013. Since the start of April, returns on dim sum bonds have been boosted by the Chinese currency's solid performance in the face of a resurgent U.S. dollar even as other Asian currencies have remained broadly flat. The yuan has appreciated more than 1 percent against the dollar since the end of March. Market participants expect further yuan gains for two reasons. One, recent regulatory moves to clamp down on hot money flows being disguised as trade settlement have prompted analysts to believe that Beijin..

 

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Thu, 16 May 2013 21:25:47

Dollar near 10-mth high as Fed dove foreshadows QE wind-down

The U.S. dollar held firm near a 10-month high against a basket of major currencies on Friday after a regional Fed chief, long seen as a policy dove, said the Fed could begin easing up on stimulus this summer and end it late this year. Remarks by John Williams, president of the Federal Reserve Bank of San Francisco, moved markets as investors see his thinking close to that of the Fed's top officials such as Chairman Ben Bernanke and Vice Chair Janet Yellen. "At the previous policy meeting, the Fed essentially said whether it will reduce or expand its bond buying is 50-50. But markets are now suspicious that Bernanke may signal it's something like 55-45 when he testifies in the congress on May 22," said Minori Uchida, chief FX analyst at the Bank of Tokyo-Mitsubishi UFJ. The dollar index , which measures the currency's value against a basket of six major currencies, stood at 83.736, near 10-month high of 84.094 set on Wednesday. A break of its July peak of 84.100 could open the..

 

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