The yen rose, reversing earlier losses, on concern China will act to cool economic growth, spurring demand for Japan’s currency as a refuge.
The yen gained versus 14 of its 16 major counterparts as Asian stocks declined after China’s statistics bureau said inflation quickened to 5.4 percent in March from a year earlier, the fastest pace since 2008. The Dollar Index was close to the lowest level since December 2009 on bets the impact of commodity prices on inflation won’t be enough to convince Federal Reserve policy makers to curtail stimulus.
“Strong numbers out of China led to concern that Chinese government will tighten its policy further,” said Masahide Tanaka, a senior strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan’s second-largest bank. “That caused risk- aversive buying of the yen.”
The yen gained to 120.53 per euro as of 12:34 p.m. in Tokyo from 120.97 in New York yesterday. Japan’s currency bought 83.31 per dollar from 83.50. The euro traded at $1.4464 from $1.4488.
The Dollar Index, which tracks the greenback against six major U.S. trading partners’ currencies, was at 74.781 from 74.726 yesterday, when it touched 74.617, the lowest since December 2009.
The MSCI Asia Pacific Index of regional shares lost 0.6 percent.
China’s economy grew 9.7 percent in the first quarter, according to separate data released by the statistics bureau in Beijing today. The median forecasts in Bloomberg surveys of economists were for economic growth of 9.4 percent and inflation of 5.2 percent.
