9 March 2001, 11:50  FED'S MCDONOUGH TELLS LONDON AUDIENCE OF SLOWDOWN

G3 CURRENCIES TIGHTLY RANGE-BOUND] The upcomingannouncement of the new Japanese economic stimulus package and the release ofFebruary non-farm payroll in the U.S. were the main focus of the market.Also putting a damper on price action was options-related trading in dollar-yen. * [ASO: GOVERNMENT LIKELY TO LOWER ECONOMICASSESSMENT] Japanese Minister for Economic and Fiscal Policy Taro Aso reportedly saidthe government will probably have a more severe assessment of theeconomy in March than in February. He also dismissed the use of a weakeryen to boost the economy on the view that it leads foreign investors tosell Japanese stocks * [MIYAZAWA APOLOGIES FOR CHOICE OF WORDS THURSDAY]Finance Minister Kiichi Miyazawa reportedly said that his comment to theParliament that the Japanese finances was close to collapse was 'inappropriate'.He added that he meant that the pressure to implement fiscal reformis New York Federal Reserve President William McDonough saidThursday that U.S. growth in the first quarter is likely to be "quiteweak" but remain "slightly positive." The slowdown in the U.S.economy has not reached bottom yet but it will trend back up in thesecond half, he said after delivering a speech at a conference onthe Basle Accord organized in London by the British BankersAssociation.

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