Pacific Investment Management Co., home to the world’s biggest fixed-income fund, is shying away from risky assets as it sees a growing disconnect between the performances of financial markets and the global economy.
The euro is under pressure as sovereign-wealth funds and central banks move reserves back into dollars or diversify into other currencies, Samarjit Shankar, a Boston-based managing director for the foreign-exchange group at Bank of New York Mellon Corp., said at a round-table with reporters in Tokyo.
Most U.S. stocks rose, led by financial shares, as the Standard & Poor’s 500 Index extended its rally past 1,600. The euro fell as European Central Bank President Mario Draghi said policy will remain accommodative and the ECB will act again to boost growth if needed.
Yuan forwards headed for the biggest monthly advance since January 2012 on expectations China will allow appreciation to pick up as the currency becomes more widely used for trade and investment globally.
French Finance Minister Christine Lagarde said a world with a single reserve currency is vulnerable to economic crises, underlining the need for more global policy coordination in the face of trade imbalances.