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The yen lost more ground in Asia on Wednesday, hitting a seven-month low against the dollar after Japan released another batch of weak trade data, which raised hopes for fresh monetary easing.
The dollar bought 81.96 yen in Tokyo trade, hitting levels last seen in early April, and up from 81.67 yen in New York late Tuesday.
The euro also bought 104.93 yen from 104.70 yen, although it eased to US$1.2801 from US$1.2818 in New York.
The yen’s weakness was stoked by Japan’s larger-than-expected trade deficit for October, the latest data to underscore slowing in the world’s third-largest economy, said a senior dealer at a major Japanese bank.
“If you look around, you see only yen-selling investors,” he told Dow Jones Newswires.
Official data Wednesday showed the October trade deficit nearly doubled to 549 billion yen ($6.7 billion) as shipments to key the European market sank, while a territorial spat with China also hurt.
Chinese consumers have dumped Japanese products in the wake of the row over an East China Sea island chain claimed by both Japan and China.
The deficit, Japan’s worst October trade figures in more than 30 years, came as markets speculated the Bank of Japan would usher in further easing measures after its next meeting in December.
The yen has been under pressure since Shinzo Abe, the main opposition leader and likely prime minister after next month’s general election, said he would push for unlimited monetary easing to tackle the economy’s ongoing weakness.
However, the bank held off further easing after a meeting Tuesday, and rejected Abe’s proposals.
Investors were keeping a close eye on a European finance ministers’ meeting that started Tuesday aimed at agreeing on the latest batch of bailout cash for Greece, with markets pricing in the likelihood of an agreement.
Jean-Claude Juncker, who heads the Eurogroup of finance ministers from the 17 countries that use the single currency, said Athens had “delivered” on its austerity promises, adding that there were “good chances” for a deal.
A major sticking point was whether to give the country an extra two years to get its house in order and reach a point where it can raise its own funds.


Yen stumbles on poor trade figures, easing hopes

Japanese 10,000 yen bank notes are spread out at an office of World Currency Shop in Tokyo in this August 9, 2010 illustrative picture. (REUTERS/Yuriko Nakao)

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