Asian markets advanced on Monday, continuing a rally at the end of
last week, with Tokyo boosted by a weaker yen after the head of the
Federal Reserve stuck to her plan to raise interest rates by the year's
end.
The euro suffered further losses as Greece warned it did not
have enough money to service its debts next month unless it receives the
rest of its bailout cash.
Tokyo added 0.54 percent, Sydney put on 0.73 percent and Shanghai added 0.50 percent while Singapore rose 0.30 percent.
Hong Kong and Seoul were closed for public holidays.
Fed
chief Janet Yellen said on Friday she expects to hike rates from
historic lows "at some point this year", warning that a delay could risk
overheating the economy. However, she also said there were still
weaknesses, including slackness in the job market despite unemployment
at 5.4 percent.
Her comments came two days after minutes of the
Fed's April policy board meeting made clear that slow growth in recent
months meant it was not expecting a rise before late July.
Adding
to the dollar's strength was news from the US Department of Commerce
that core consumer prices -- which exclude food and energy -- jumped 0.3
percent in April from March, the largest one-month rise in more than
two years.
The dollar was at 121.57 yen early Monday, against 121.52 yen in New York and sharply up from 120.71 in Tokyo earlier Friday.
"Inflation
is speeding up a little in the US, and we can see the intention to
raise rates sometime this year," Shoji Hirakawa, chief equity strategist
at Okasan Securities Co in Tokyo said by phone. "When we consider the
US versus Japan, rates will be higher in the States. Japan's rate hikes
and tapering will be further into the future."
- Greece 'out of cash' -
Japan
has for the past two years been embarking on a bond-buying programme
that pumps cash into the financial markets -- which hits demand for the
yen -- in a bid to defeat deflation.
The euro fell to $1.0983 and
133.63 yen from $1.1016 and 133.86 yen in US trade as investors grow
worried about Greece's ongoing bailout overhaul talks.
Interior
Minister Nikos Voutsis told Mega TV that Athens has nothing with which
to pay the International Monetary Fund ahead of a June 5 deadline.
"The
instalments for the IMF in June are 1.6 billion euros. This money will
not be given. There isn't any to be given. This is a known fact," he
said.
Nevertheless, the minister believes that negotiations
between Athens and its creditors were taking place "on the basis of
cautious optimism that there will be a strong agreement".
Athens
has been locked in months-long discussions with the IMF and European
Union over restructuring its bailout terms in order to release the last
batch of rescue money to pay its bills.
However, with both sides
unable to agree a deal there are fears the country will default, which
could see it tumble out of the eurozone.
On Wall Street the Dow fell 0.29 percent, the S&P 500 lost 0.22 percent and the Nasdaq eased 0.03 percent
Oil
prices were higher. US benchmark West Texas Intermediate for July
delivery rose nine cents to $59.81 a barrel and Brent crude for July
added seven cents to $65.44.
Gold fetched $1,202.38 compared with $1,212.40 late Friday.
By AFP
