| G7 MEETING G7 makes no mention of yen in communique
ESSEN, Germany (AFX) - G7 finance ministers and central bank governors made no reference to the weakness of the yen in the communique issued at the end of their meeting here. Some euro zone ministers had expressed concern about the yen in the run-up to the meeting, but ministers agreed that it was inappropriate to single out any particular member currency for criticism in the communique. Instead, they stuck to their standard language on currencies. "We reaffirm that exchange rates should reflect economic fundamentals. Excess volatility and disorderly movements in exchange rates are undesirable for economic growth," they said. "We continue to monitor exchange markets closely and cooperate as appropriate," they added. But they reiterated their call for greater exchange rate flexibility in China.
UPDATE: Yen Battles Yuan For G7 Spotlight
NEW YORK (Dow Jones) -- The Chinese yuan now has a bit more competition in the contest for the most undervalued currency. The weakness in the Japanese yen is dominating the market's attention as financial leaders from the Group of Seven leading industrial nations prepare to meet in Essen, Germany, this weekend. European officials, worried about the impact of a rising euro on the eurozone's economy, have complained that a weak yen gives Japan an unfair trading edge. But will anybody listen to their complaints? The yen slumped to a four-year low against the dollar, an all-time low against the euro, a 14-year low against the British pound, and nine-year lows against the Australian dollar, New Zealand dollar and the Swiss franc earlier this year. Japan's currency has been especially weak versus the euro in recent years, losing about 50% of its value since the end of 2000.
Policies, fixed forex rate cause Zimbabwe gold production nose dive
BLANTYRE (Mineweb.com) --Poor policies, coupled by a fixed exchange rate, have weighed heavily on Zimbabwes gold production whose 2006 output slumped by 21%, realizing a mere 11 tonnes compared to 14 tonnes in 2005.
Zimbabwes Reserve Bank governor Gideon Gono recently released the figures, which were in line with projections made by independent analysts, who have blamed poor polices and a fixed exchange rate. Ironically, early last month the Minister of Home Affairs Kembo Mohadi denied a downturn in gold production in the country.
Economic analysts also blamed the slump in output on erratic payments to gold miners by the Reserve Bank of Zimbabwe and the Fidelity Printers and refineries, which have reneged on a commitment to pay gold producers in foreign currency, according to the Zimbabwe Independent Newspapers.
Forex Weekly Review and Outlook Central Bank Meetings Take Center ...
After a volatile week full of important economic events, the forex markets actually ended up having not much progress and ended in previous week's range. With the Fed now more comfortable on growth and inflation, markets seem to have reached consensus that Fed will keep rates on hold the first half. Attention will be turned to central bank meeting this week, in particular ECB's press conference and whether Trichet will signal rate hike in March. Also, G7 speculations will likely continue to trigger volatility in the Japanese yen. The focal point of last week for the forex market was the FOMC meeting. As widely expected, the Fed left rates on hold at 5.25%. And the Fed did modified the accompanying to reflect recent solid economic data by saying that "recent indicators have suggested somewhat firmer economic growth" instead of "recent indicators have been mixed".
Yen Won't Be Focus of G-7, Drops Most Against Dollar in a Month
Feb. 7 (Bloomberg) -- The yen dropped the most against the dollar in almost a month after a Japanese finance ministry official said foreign-exchange won't be a focus at this weekend's Group of Seven meeting, suggesting the government will spurn European calls to encourage a stronger currency. Japan's yen also posted the biggest one-day loss since December against the euro after the official, who spoke in Tokyo on condition of anonymity, said the G-7 probably won't have a ``big'' debate about currencies when they meet in Essen, Germany, on Feb. 9-10. U.S. Treasury Secretary Henry Paulson yesterday signaled he doesn't share European officials' concern over the Japanese exchange rate. ``There is no broad consensus,'' said Christian Dupont, a senior currency trader at Societe Generale SA in Montreal.
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