Euro falls on Draghi stimulus comments as franc drops, yen jumps
Bloomberg
The euro weakened the most in a year against the yen as European Central Bank President Mario Draghi said policy makers would broaden asset purchases should the inflation outlook for region diminish.
Officials “will do what we must to raise inflation and inflation expectations as fast as possible,” Draghi said at a conference in Frankfurt today. Among 16 major peers, only the Swiss franc fell against the euro, dropping amid speculation the nation’s central bank is intervening to defend its 1.20-per-euro cap. The yen rose, paring the sharpest five-week decline against the dollar since 1995, after Japan’s Finance Minister Taro Aso said the currency had depreciated too rapidly.
“The euro will go progressively lower,” said Jane Foley, senior foreign-exchange strategist at Rabobank International in London. “Draghi is continuing to apply this level of urgency about needing to boost inflation and the implication of that, once again, may be that he is a proponent of potentially using full-blown quantitative easing.”
The euro weakened 1.2 percent to 146.51 yen at 10:16 a.m. London time, the biggest decline since Nov. 7, 2013. The shared currency dropped 0.8 percent to $1.2439. The yen advanced 0.4 percent to 117.77 per dollar, halting a six-day drop. The Swiss franc weakened 0.03 percent to 1.20219 per euro.
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