The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥89.85 level and was supported around the ¥88.80 level. Finance minister Nakagawa verbally intervened against the yen, saying rapid movies are undesirable. The lower house of Parliament today passed a supplementary budget valued at ¥4.79 trillion to counter the ongoing recession but the legislation could face a delay in the upper house. Data released in Japan today saw December outstanding bank lending increase a record 3.7% y/y, an indication that companies are still having difficulty raising funds in the asset-backed commercial paper market. Other data released in Japan today saw the November current account surplus off 65.9% y/y while the December M3 money supply was up +0.8% y/y. Standard & Poors affirmed Japan’s sovereign debt ratings overnight. Other data released in Japan overnight saw December corporate bankruptcies up 24% y/y. The Nikkei 225 stock index lost 4.79% to close at ¥8,413.91. U.S. dollar offers are cited around the ¥104.15 level. The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥117.70 level and was capped around the ¥119.55 level. The British pound moved lower vis-à-vis the yen as sterling tested bids around the ¥129.70 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥79.30 level. The Chinese yuan strengthened vis-à-vis the U.S. dollar as the greenback closed at CNY 6.8341 in the over-the-counter market, down from CNY 6.8370. Data released in China overnight saw the country’s foreign reserves rise to US$ 1.95 trillion at the end of 2008 while the 2008 trade surplus printed at US$ 295.46 billion, up from US$ 262.2 billion in 2007.
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