TMS: Yen dips as Japanese finance minister steps down
LONDON (AFP) --
The yen slid against the dollar on Wednesday as Japan's finance minister stepped down for health reasons, while the euro edged higher despite stubborn worries over debt-ridden Greece, analysts said.
In London morning deals, the dollar increased to 92.39 yen from 91.70 yen in New York late on Tuesday.
The European single currency firmed to 1.4373 dollars from 1.4367 dollars on Tuesday.
Japan's Prime Minister Yukio Hatoyama said Wednesday he had picked his deputy Naoto Kan as finance minister, replacing 77-year-old Hirohisa Fujii who is stepping down for health reasons.
Hatoyama said Fujii's resignation was unavoidable due to exhaustion and high blood pressure, caused by months of hard work drawing up the national budget.
"A change in personnel will have little impact on the yen, but evidence of internal disagreement on fiscal policy could well become a yen-negative factor," said economist Derek Halpenny at The Bank of Tokyo-Mitsubishi UFJ.
The euro recovered after falling as low as 1.4284 dollars on Wednesday after the European Union indicated that it would not come to the rescue of Greece.
Greece, struggling with a double-digit public deficit, cannot expect the European Union to "save" it, the European Central Bank's chief economist said in an interview published on Wednesday.
"Greece's problems are decidedly Greek, as Prime Minister George Papandreou has himself admitted," Juergen Stark told the Italian financial daily Il Sole 24 Ore.
"The markets are fooling themselves if they think that at some point the other EU member states will put their hands in their pockets to save Greece."
He spoke as officials from the ECB and from the European Commission began a mission in Athens to examine with Greek officials a crisis programme to stabilise national Greek finances which the Greek government is to submit to the EU Commission by the end of January.
"The comments ... underline the pressure the euro faces this year from worsening public finances in the periphery," said Lloyds Banking Group PLC (ADR) (Public, NYSE:LYG) economist Kenneth Broux.
Greece's deficit, the difference between spending on central, welfare and local government budgets and revenues, is estimated to be 12.7 percent of gross domestic product.
Investors were meanwhile awaiting the publication Wednesday of key US economic data and minutes from the Federal Open Market Committee's December monetary policy meeting.
Markets are also eagerly awaiting US non-farm payrolls (NFP) data due on Friday.
In London on Wednesday, the euro was changing hands at 1.4373 dollars against 1.4367 dollars late on Tuesday, 132.80 yen (131.74), 0.8971 pounds (0.8979) and 1.4855 Swiss francs (1.4847).
The dollar stood at 92.39 yen (91.70) and 1.0335 Swiss francs (1.0333).
The pound was at 1.6021 dollars (1.5999).
On the London Bullion Market, the price of gold increased to 1,126.57 dollars an ounce from 1,123.25 dollars on Tuesday.
