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The yen rose for the first time in five days against the dollar as an opposition lawmaker said his party will oppose Bank of Japan Deputy Governor Nominee Kikuo Iwata, who investors see as endorsing monetary policy easing.
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Group of 20 finance chiefs debated adopting a tougher stance on exchange rates as they prepare to reiterate a pledge against competitive devaluations.
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The euro fell the most since July against the dollar after European Central Bank President Mario Draghi said the recent strength of the currency creates a concern that inflation will slow.
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The yen rose against most of its major counterparts after the U.S. economy grew less than forecast and Standard & Poor’s cut Spain’s credit rating, adding to concern Europe’s debt crisis is worsening.
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The yen rose from a four-month low against the dollar as disappointing U.S. corporate results and record unemployment in Spain boosted the allure of the relative safety of Japan’s currency.
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Foreign-exchange traders are putting their faith in Jean-Claude Trichet, betting the European Central Bank President will save the euro from a collapse predicted by everyone from George Soros to Paul Volcker.
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The dollar gained from almost a one- month low versus the euro as concern a deal for Greece to buy back its bonds may falter while U.S. lawmakers struggled to reach a budget consensus boosted haven demand.
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The euro fell to a two-month low versus the dollar after European Union finance ministers said they will delay for “weeks” the decision to give Greece its next round of aid.
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The dollar and the yen gained versus most major counterparts as companies reported financial results that missed analyst estimates, adding to evidence the global economy is slowing and sapping risk appetite.
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The euro rose against most of its 16 major peers after two central bank officials said European Central Bank President Mario Draghi will announce unlimited sterilized bond buying to quell the region’s debt crisis.