Asian session: The euro rose

The euro rose for a second day as Spain’s pledge to meet its deficit target spurred prospects it will qualify for an international rescue that will help stem Europe’s debt crisis. Spanish Prime Minister Mariano Rajoy’s government announced its fifth austerity package yesterday, which included a new tax on lottery winnings and a cut in ministries’ spending to shrink the euro area’s third-biggest budget deficit. The 2013 shortfall target is 4.5 percent of gross domestic product compared with a 6.3 percent goal for this year.

Economists estimate that data next week will show euro- area manufacturing contracted and unemployment climbed to a record.

The yen strengthened versus all of its 16 major counterparts this week as a dimming outlook for the global economy spurred demand for the currency as a refuge. Japan’s statistics bureau said today consumer prices fell 0.3 percent in August from a year earlier, matching the steepest decline in 16 months as the central bank remains distant from its 1 percent inflation target. The Ministry of Trade said in a preliminary report industrial production fell 1.3 percent last month after a 1 percent drop in July.

The Australian dollar gained versus its peers before HSBC Holdings Plc and Markit Economics releases tomorrow the final figure for its manufacturing purchasing managers’ index for China, the South Pacific nation’s biggest trading partner. The preliminary report released Sept. 20 showed the gauge was at 47.8, signaling an 11th month of contraction.

EUR/USD: during the Asian session, the pair rose to $1.2940.

GBP/USD: during the Asian session, the pair rose to a weekly high.

USD/JPY: during the Asian session the pair fell by updating week’s low.