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The dollar fell the most in two weeks, while stocks rose as traders took bullish cues from improving Chinese data and comments from Treasury Secretary Janet Yellen. The yen had the biggest move against the dollar, surging more than 1% after Bank of Japan Governor Kazuo Ueda aired the possibility of ending the developed world’s last key negative interest rate.
Meanwhile, Europe’s Stoxx 600 rose 0.5% and US futures pointed to gains on Wall Street. Tesla Inc rallied 5% in US premarket trading on an upgrade from Morgan Stanley. Italian banks led gains among European lenders after a report that the government is weighing changes to a controversial tax on banks’ windfall profits.
Speaking over the weekend, US Treasury Secretary Janet Yellen said she’s increasingly confident that the US will be able to contain inflation without major damage to the job market. “Every measure of inflation is on the road down,” Yellen said.
In China, there’s hints that the economy may be stabilising after a sharp downturn. Strong credit data published showed recent steps to bolster the real estate market may be starting to lift household demand for mortgages, while corporate loans also picked up.
The yuan rebounded from a 16-year low after the People’s Bank of China delivered a strong verbal warning to speculators. Policymakers also set a daily fixing that was stronger-than-expected.
The benchmark CSI 300 Index rose 0.7% on Monday, snapping a four-session losing streak. In commodity markets, copper, iron ore and other metals also got a boost from the weakness in the greenback, while improved Chinese data aided sentiment.