(BN) Yen Remains Lower on Speculation Central Banks to Boost Stimulus

(BN) Yen Remains Lower on Speculation Central Banks to Boost Stimulus

By Masaki Kondo and Mariko Ishikawa

     July 4 (Bloomberg) -- The yen remained lower against most of its 16 major peers following a decline yesterday amid speculation central banks will introduce more steps to stimulate growth, sapping demand for haven assets.

     The dollar was 0.1 percent from a two-month low versus the Australian currency before U.S. data tomorrow that may show private employment rose at the slowest pace in 10 months. Stocks climbed globally and a gauge of commodities jumped after the International Monetary Fund said additional monetary easing may be needed in the U.S. The European Central Bank will probably cut interest rates tomorrow, a Bloomberg News survey forecast.

     “The ECB story itself will do wonders to keep the risk on for a little bit longer,” said Gavin Stacey, Sydney-based chief rate strategist at Barclays Plc. “What we’re seeing in terms of safe haven currencies, a little bit of softness in dollar and yen, will be consistent with the idea that risk is extending.”

     The yen traded at 100.63 per euro as of 8:16 a.m. in Tokyo after losing 0.6 percent to 100.61 in New York yesterday. It fetched 79.84 per dollar from 79.79. The U.S. currency was at $1.2604 per euro after sliding 0.3 percent to $1.2608. The greenback was little changed at $1.0285 per Australian dollar after reaching $1.0297 yesterday, the weakest since May 3.

     U.S. financial markets are shut today for the Independence Day holiday.

                         Employment Data

     Companies in the U.S. probably added 100,000 jobs in June, the smallest gain since August, a Bloomberg poll of economists shows before ADP Employer Services releases the figure tomorrow.

     The U.S. economy will grow about 2.25 percent in 2013 amid a “tepid” recovery and the European debt crisis, the IMF said, lowering its previous projection of 2.4 percent. “Further easing” by the Federal Reserve might be needed “if the situation was to deteriorate,” IMF Managing Director Christine Lagarde told reporters in Washington yesterday.

     The MSCI All-Country World Index of shares rose 1 percent yesterday. The Standard & Poor’s GSCI Total Return Index of commodities gained 3.5 percent to the highest since May 22.

     The ECB will probably lower its main refinancing rate by a quarter-percentage point to 0.75 percent on July 5, according to the median estimate in a Bloomberg survey of economists.