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Yen Near Seven-Year Low Amid Speculation Abe to Call Election

The yen traded 0.5 percent from a seven-year low amid speculation Japanese Prime Minister Shinzo Abe will call a general election to shore up support and postpone a planned sales-tax increase.

The yen reached 116.10 per dollar this week, the least since October 2007, after a ruling Liberal Democratic Party lawmaker said preparations for a snap election have begun. It rebounded yesterday after Finance Minister Taro Aso downplayed the possibility of a delay in raising the levy. The euro held a loss before German data forecast to confirm consumer prices fell last month. The Aussie traded near the highest in a week before Chinese data on retail sales and industrial production.

The yen traded at 115.50 per dollar as of 9:21 a.m. in Tokyo from 115.49 yesterday, when it rose 0.3 percent. It was little changed at 143.66 per euro. The shared currency was at $1.2434, after declining 0.3 percent in New York.

Australia™s dollar traded at 87.16 U.S. cents from 87.19 yesterday, when it touched 87.45, the most since Nov. 5.

Japan™s currency has tumbled 5.5 percent against the dollar since Oct. 30, the most among its developed-market peers, after policy makers surprised investors at the end of last month with further currency-depreciating stimulus from the Bank of Japan and pension reforms that allow more money to flow abroad and into domestic stocks. Japan™s Nikkei 225 Stock Average has surged 9.2 percent, and closed above 17,000 this week for the first time in seven years.

Source : Bloomberg

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