Japan ready to intervene again on strong yen

TOKYO — Japan on Friday voiced concern over the rise of the yen to fresh 15-year highs against the dollar and signalled it was ready to wade back into markets to intervene amid fears of a global devaluation battle.

“I am very concerned about the current situation,” Prime Minister Naoto Kan told parliament when asked about the yen’s strength, which puts Japan’s growth-driving exporters at a disadvantage by making their products more expensive overseas.

“We will take decisive steps when necessary, from the perspective of curbing excessive fluctuations in exchange rates,” Finance Minister Yoshihiko Noda told a regular press conference.

Amid expectations the US Federal Reserve will adopt further easing measures to pump more liquidity into the world’s largest economy and further weaken the dollar, the unit Thursday plunged to fresh 15-year lows against the yen.

A surprise policy tightening move by Singaporean authorities to widen the trading band of its currency on Thursday also added to pressure on the greenback and pushed the Singaporean unit to record highs.

On Friday the dollar stood at 81.42 yen, little changed from 81.44 in New York Thursday, after the unit earlier plunged to a 15-year low of 80.89 yen.

 

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Japanese economy ‘at standstill’

The Japanese economy is at a standstill, Japan’s government has said, as concerns about the strong yen continue to grow.

The recovery in the economy was “pausing”, the Cabinet Office said in a monthly statement.

It is the most negative the government has been about the economy in nearly two years.

The rising yen and a slowdown in global demand for Japanese exports was blamed for the downgrade.

In recent months, the government has insisted that the economy is “picking up”.

But it said it now expected the economy to remain weak for some time, with “weakening” exports a chief concern.

It said shipments to Asia in particular were becoming weaker, further hitting exporters that are already suffering from the strong yen.

http://www.bbc.co.uk/news/business-11571644

 

 

Emerging economies alter dynamics of oil demand

http://www.ft.com/cms/s/0/a6b6d93a-abc0-11df-9f02-00144feabdc0.html

Emerging economies have upended the long-standing pattern of global oil consumption, according to the west’s energy watchdog, in a further sign of how countries such as China and India are transforming commodities markets.

The International Energy Agency estimates that oil demand was higher this year during the second quarter for the first time, at about 86.6m barrels a day, ahead of the traditional peak winter season of January-March, at 86.0m b/d.

But with growing demand for oil coming from countries such as China, India, Saudi Arabia, Brazil and Indonesia, seasonal patterns are changing, a trend the Paris-based IEA believes will accelerate.

The IEA said: “This emerging seasonality will probably raise new refining and logistical challenges.”

In the past, oil demand fell 1.5-2.0m b/d between the first and second quarters, allowing refineries to undergo maintenance. Low demand periods helped to build inventories to meet peak consumption later.

Peter Popham: Japan shows us the limits of growth

http://www.independent.co.uk/opinion/commentators/peter-popham-japan-shows-us-the-limits–of-growth-2054285.html

It’s finally happened: China’s economy has overtaken Japan’s. Less than 20 years after Deng Xiaoping told his people that “to get rich is glorious”, and three decades after the Chinese Communist Party began its first timid opening to the outside world, the Central Kingdom has surpassed its rival across the Sea of Japan. China is now officially the world’s number two and, unless something inconceivable happens, it will hold that place until it becomes number one, maybe as soon as 2030.

There are several reasons why Japan stopped growing after the crash. An ageing population, a shrinking birth rate and a national disinclination to admit millions of immigrants are among the obvious ones. But one reason economists tend to overlook is the following: with the Cold War coming to an end, Japan saw that, for the first time since the 1850s, there really was nothing to fear any more.