* Yen rises vs dollar after Japan PM Abe's remarks
* RBNZ Gov says NZ dlr is significantly overvalued
* Euro firm vs dollar in wake of upbeat German ZEW survey
By Masayuki Kitano
SINGAPORE, Feb 20 The yen rose versus the dollar
on Wednesday after Japanese Prime Minister Shinzo Abe said the
need to establish a public-private sector fund to buy foreign
bonds has declined.
The possibility of setting up such a fund, tasked with
measures including purchases of foreign bonds, had been included
in a campaign platform drawn up by Abe's Liberal Democratic
Party ahead of a national election last December.
"I think he was told at the G20 ... 'don't you dare, don't
you dare do that'," said Rob Ryan, a strategist for RBS in
Singapore, referring to the idea of setting up a fund to buy
The Group of 20 nations declared at a meeting in Moscow on
Saturday that there would be no global currency war. Japan's
expansive policies, which have driven down the yen, escaped
By mid-afternoon, the dollar was down 0.3 percent to 93.32
yen, edging away from a 33-month high of 94.465 yen set
on Feb. 11 on trading platform EBS. The dollar fell to as low as
93.12 after Abe's remarks.
The greenback has risen roughly 7.5 percent versus the yen
this year, with the Japanese currency pressured by expectations
that Japan will take further stimulative steps to fight
Market players, however, said the yen's decline may slow in
the near term.
"The pace of yen depreciation will slow," said Sim Moh
Siong, FX strategist for Bank of Singapore.
"In light of the G20 statement to avoid competitive
devaluation, it will be difficult to talk down the yen
specifically. The onus now is on policy to do the work," he
Abe said on Wednesday that cabinet ministers need to be
careful when explaining FX levels, while Japanese Chief Cabinet
Secretary Yoshihide Suga refrained from commenting on currency
"I think there will be some range trading for a while," said
Satoshi Okagawa, senior global markets analyst for Sumitomo
Mitsui Banking Corporation in Singapore, adding that the dollar
hold between 92.50 and 95.50 yen over the next couple of weeks.
Market players are waiting for more clarity on the
government's choice for the next Bank of Japan governor to
replace Masaaki Shirakawa.
A delay in nominating a new BOJ governor has fanned talk of
friction between Japan's prime minister and finance minister
over who should run a central bank charged with taking
aggressive action to beat deflation.
Earlier on Wednesday, the yen showed little reaction to data
showing that Japan's trade deficit widened to a record in
January as energy imports rose more than expected.
EURO/DOLLAR RISES; KIWI SLIDES
The euro rose 0.3 percent to $1.3426, staying firm
after data on Tuesday showed a strong improvement in German
The ZEW index rose to its highest since April 2010, beating
even the highest forecast in a Reuters poll.
The New Zealand dollar slid 0.8 percent to $0.8399
after Reserve Bank of New Zealand (RBNZ) Governor Graeme Wheeler
said the New Zealand dollar was significantly overvalued
compared to its economic fundamentals.
Wheeler also said RBNZ was ready to intervene in FX markets
when circumstances were right.
The kiwi had climbed to $0.8534 on Friday, its strongest
level since September 2011.