Asian session: The yen weakened past 80 against the dollar

The yen weakened past 80 against the dollar for the first time in three months as signs the world’s third-largest economy is closer to contraction fanned speculation that the Bank of Japan will add further stimulus. Japanese Economy Minister Seiji Maehara, who has been calling for more action from the central bank, said today he may attend the BOJ’s next meeting on Oct. 30 if schedule permits. Maehara took part in the previous gathering ended Oct. 5, the first minister to do so for more than nine years.

Demand for the euro was limited before a report today that may show an index of European consumer confidence remained at a more-than three-year low. The European Commission in Brussels will probably say today its initial estimate for sentiment was minus 25.9 in October, according to the median estimate of economists in a Bloomberg News survey. That would match September’s reading that was the lowest since May 2009.

The Australian dollar held onto three days of losses before data forecast to show inflation held near the slowest in 13 years, providing scope for the Reserve Bank to cut borrowing costs. In Australia, the so-called trimmed mean gauge of core consumer prices probably rose 2.2 percent in the three months ended Sept. 30 from a year earlier, according to economists surveyed by Bloomberg before the statistics bureau publishes its inflation report tomorrow. That compares with a 2 percent increase in the previous quarter, the slowest pace since June 1999. The Reserve Bank of Australia targets average annual inflation of 2 percent to 3 percent. Interest-rate swaps data compiled by Bloomberg show traders are almost certain that policy makers will cut the overnight cash rate target by 25 basis points to 3 percent at their next meeting on Nov. 6.

EUR/USD: during the Asian session the pair fell to $1.3050.

GBP/USD: during the Asian session, the pair traded in the range of $1.6005-25.

USD/JPY: during the Asian session, the pair rose to Y80.00, but later backed away from that level.