12 January 2001, 11:00  Europe FX Opening: Summary of overnight moves and what's ahead

A further comment from Japanese Finance Minister Miyazawa, tolerating the weakening JPY, was the catalyst for the EUR and USD to reverse a late US dip.
The EUR ended the Asian session at, or above, the highs of Thursday set in late US trading against the USD, JPY and GBP. USD/JPY suffered a minor profit taking wobble in late US, before pushing to a new multi-month high.
--EUR/USD pushed to 0.9554 in late US trading, though profit taking sent it back to the 0.9510 region by the Asian open. Once again, Japanese Finance Minister Miyazawa said he is not worried by the JPY's weakening which, in a repeat of the pattern of recent days sent the JPY lower, dragging other pairs and crosses higher. EUR/USD hit a 5-day high of 0.9573 in late Asian trading.
--EUR/JPY recovered from a dip to 111.69 to hit 113.05, levels not seen since October 1999, following Miyazawa's comment. Speculative accounts were spotted buying on dips. The JPY's losses were unaffected by the METI's Hiranuma's reported comment that Japanese officials would take action if the JPY weakened further, dealers noting that it is the MOF which decides FX policy.
The ECB's monthly bulletin, released late on Thursday, showed the ECB regards the risks to price stability in the zone are now "more balanced," but warned on wage developments which, coupled with the ECB's "firm determination" to maintain price stability, suggests the ECB is not going to cut interest rates in the short term. Today sees the release of final French Q3 GDP and preliminary December CPI data. German finance minister Eichel ends his 3-day visit to India.
--EUR/GBP recovered from a dip to the 0.6345 region to test Thursday's 0.6380 high in late Asian trading. Cable pushed steadily to hit 1.50 by the close. UK November industrial production and manufacturing data are released at 0930 GMT.
--USD/JPY was sent to an 18-month high of 118.32 following Miyazawa's comment, though ran into profit taking around the highs. US data out today includes December PPI and retail sales at 1330 GMT.

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