Currency Headlines
Yen Declines After Abe Says He May Change BOJ Law GB£
The yen declined toward a 20-month low against the dollar after incoming Japanese Prime Minister Shinzo Abe said he will consider changing the law governing the central bank unless it boosts its inflation target next month.
Japan’s currency fell versus all but one of its major peers on speculation the Bank of Japan will need to step up currency- debasing measures to reach the inflation goal. The dollar weakened versus the euro after rising 0.4 percent on Dec. 21 amid concern that U.S. lawmakers will fail to avert the so- called fiscal cliff of tax increases and spending cuts
Draghi’s Cash Triggers Unprecedented Drop in Bank Lending Stress
European Central Bank President Mario Draghi’s $1.3 trillion of cheap loans and pledge to do whatever it takes to stand behind the euro helped push indicators of stress in the continent’s money markets down by an unprecedented degree this year.
The difference between the euro interbank offered rate and overnight index swaps, a measure of European banks’ reluctance to make unsecured loans to one another known as the Euribor-OIS spread, contracted a record 0.85 percentage point this year to 0.12 percent, according to data compiled by Bloomberg. The Frankfurt-based ECB has lent financial institutions more than 1 trillion euros ($1.3 trillion) under its longer-term refinancing operations since December and is committed to providing cheap, unlimited cash for lenders to boost the economy. Draghi’s pledge to stand behind the currency of the 17- nation euro area in July eased stresses in money markets, where banks fund their day-to-day business
RBI REFERENCE RATE (20-11-12)
CURRENCY US$ €URO GB£ ¥EN
RATE 55.0858 72.6164 89.0958 65.29
INDIAN FOREX RESERVE
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