- Bank of Japan Governor Haruhiko Kuroda said the yen was unlikely to weaken further, sparking a rally in the Japanese currency vs. the dollar. The yen jumped to 122.98 per dollar after Kuroda's comments, having struck 125.86 on Friday, the weakest level since June 2002, after strong U.S. jobs data. "If you look at the real effective exchange rate, it shows that the yen is already very weak," Kuroda said. "Even further declines on a real effective exchange rate basis are not likely to happen."
- The Chinese economy will pick up in the second half of this year, economists from the central bank have forecast, while lowering their inflation expectations. The property market is "starting to stabilize" and the world economy should show further signs of a recovery in coming months, said the economists who were led by Ma Jun, the chief economist at the central bank. Looser monetary policy conditions as a result of China cutting interest rates thrice since November were also expected to help shore up growth in coming months.
- Rating agency S&P downgraded Barclays (BCS), Deutsche Bank (DB), RBS (RBS) and Commerzbank (CRZBY) as it took into account the fact that government support could no longer be counted on to rescue the banks in case of trouble to the same extent as it did before various regulatory measures were introduced.
- U.K. industrial output beat expectations in April, rising by 0.4% month on month vs. forecasts of a rise of just 0.1% in a Reuters poll of analysts. This was due to a jump in mining and quarrying. By contrast, U.K. manufacturers saw a 0.4% decrease compared to the previous month, driven by a decline in pharmaceutical products.
- Spanish clothing firm Inditex (IDEXY), the parent of the Zara brand, said its first-quarter profit jumped 28% on the back of a weaker euro, while sales increased by 17%.
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