The dollar is currently losing ground against all of its major competitors Monday. However, the largest move to the downside was against the Japanese Yen. Japanese Economic Minister Akira Amari reportedly stated Sunday that the correction of the yen is "largely completed."
The Japanese government on Monday upgraded its assessment of the economy for the first time in two months, as a weak yen helped revive the country's exports and factory output.
"The Japanese economy is picking up slowly," the Cabinet Office said in its May monthly report. This was an upgrade from previous month's assessment when it said that economy was showing "signs of picking up while weakness can be seen in some areas."
The government expects economic recovery to resume gradually, supported by improvement in confidence and export conditions as well as due to the effects of the fiscal and monetary policies. However, it remained concerned about global economic developments and said slowdown of overseas economies still poses "downside risk."
The dollar soared to Y103.299 against the Japanese Yen on Friday, its highest level since October of 2008, but has pulled back to around Y102.500 on Monday.
A leading indicator for Japan's economic activity was revised up to show an increase in March from a month earlier, final data released by the Cabinet Office showed Monday. The leading economic index rose to 97.9 in March from 97.4 in February. The readings for both March and February have been revised from an earlier score of 97.6 and 97.7 respectively.
Fitch has also downgraded Slovenia's sovereign rating, suggesting that it will be next Eurozone nation to seek external aid. Moreover, Fitch warned that the rating will be lowered further if the recession goes deeper and longer than anticipated, or if policymakers fail to clean up the balance sheets of the banking sector.
Fitch cited significant deterioration in Slovenia's macroeconomic and fiscal outlook as the major reason for the rate cut. It has 'BBB+' rating, three notches above junk grade. Fitch forecasts a 2 percent contraction in real GDP in 2013 and a decline of 0.3 percent in 2014. The general government deficit will rise to 5 percent of GDP in 2013 from 4 percent in 2012, it said.
The buck has retreated from Friday's high of $1.2795 against the Euro, to around $1.2860 on Monday.
In the absence of effective resolution regimes, public finances will be under more pressure, Bank of England Deputy Governor Paul Tucker said Monday. The countries that resorted to bank bailout and without effective resolution system will possibly have higher government yield, policymaker said in a speech in Netherlands.
"Only with a credible mechanism to put losses to a failed bank's creditors can we harness the forces of market discipline and take tax payers off the hook," Tucker said.
He said, "only with powers and plans to resolve cross-border banking groups can we arrest the risk of national regulators progressively putting up barriers to cross-border finance."
The greenback has also pulled back from Friday's high of $1.5157 against the pound sterling on Monday, to around the $1.5225 level.
The squeeze on British household budgets eased in May, as an indicator of personal finances showed its highest reading in three years despite straying in the negative territory, a report from Markit Economics showed Monday.
The headline Markit Household Finance Index rose sharply to 40.4 in May from 37.7 in April. Reading below 50 indicates contraction. However, Markit said, the latest reading pointed to the slowest deterioration in household finances since May 2010.
The fifth consecutive monthly increase in the U.K. house prices amid limited supply took average asking prices to a record, a survey by Rightmove showed Monday. House prices hit a record GBP 249,841 in May, as new sellers raised their prices by 2.1 percent from the prior month.
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Forex News
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.