Article by ForexTime
The yen fell toward a seven-year low on speculation Japanese Prime Minister Shinzo Abe has decided to call a snap election. The Australian dollar slid after an RBA official said policy makers haven’t ruled out intervention.
The yen dropped against 15 of 16 major peers. Abe is likely to go to the people on Dec. 14 after postponing an unpopular sales tax increase slated for October 2015, according to people with knowledge of his plan, who asked not to be identified because they aren’t authorized to speak. The euro held a loss before German data forecast to confirm consumer prices fell last month.
“The market has taken the idea of a delay in raising the sales tax as a positive, so stocks have been bought and dollar-yen has risen,” said Masato Yanagiya, head of foreign exchange and money trading at Sumitomo Mitsui Banking Corp. in New York. “Once we get an actual announcement, there’s a good chance we’ll see a further reaction in the market.”
The yen weakened 0.3 percent to 115.78 per dollar as of 6:57 a.m. in London from 115.49 yesterday, after touching 116.10 on Nov. 11, the lowest since October 2007. It slid 0.3 percent to 144.06 per euro. The shared currency was at $1.2443, after declining 0.3 percent in New York to $1.2438.
Australia’s dollar dropped 0.2 percent to 87.02 U.S. cents from yesterday, when it touched 87.45, the most since Nov. 5.
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