Japan’s increased pessimism echoes that of the International Monetary Fund, which lowered 2013 global growth forecasts this month on Europe’s debt crisis and slower expansions in emerging markets from China to India. Chinese stocks fell today to the lowest since March 2009 as weakness in corporate profits threatens to add to the drags on growth from property-market curbs and limited export demand.
The Shanghai Composite Index fell 1 percent as 1:57 p.m. local time. Jiangxi Copper Co. (358) and China Shenhua Energy Co. led a decline among commodity producers.
Yen Haven
Europe’s woes have bolstered the yen’s appeal as a haven for investors, causing the currency to appreciate more than 5 percent against the dollar since mid-March and rise to a 11-year high against the euro. Japanese Finance Minister Jun Azumi reiterated today that authorities are ready to take “decisive” action on speculative and volatile movements in foreign-exchange markets. The yen traded at 78.10 against the dollar in Tokyo and the common currency touched 94.56 yen.Falling Confidence
The European Commission may say consumer confidence in the euro area fell in July in an initial estimate of the data, a separate survey showed. In the U.S., the Federal Reserve Bank of Chicago will release its gauge of national economic activity for June.‘Severe’ Market
A survey by the center of 22 domestic and foreign banks and institutions had a median forecast for third-quarter expansion of 7.8 percent, with Song’s estimate the second lowest. Chinese Premier Wen Jiabao has warned that his nation is yet to secure the economic momentum needed for a recovery and the situation in the job market may become more “severe.”Song, who studied economics at the University of Chicago from 1991 to 1995, was appointed one of three academic advisers to the central bank in March when the two-year term of his predecessor ended.
“Sharp fluctuations” in financial markets stemming from global uncertainty could hurt Japan’s growth prospects, the Japanese government said.
(Bloomberg)
