Asian session: The yen headed

The yen headed for its biggest weekly drop in almost five months on speculation Japan’s opposition party will take power after elections next month and increase pressure on the central bank to expand monetary easing.

The yen held yesterday’s steepest slide in two months versus the euro before Japanese Prime Minister Yoshihiko Noda dissolves parliament today. Prime Minister Yoshihiko Noda will dissolve parliament today, triggering an election on Dec. 16 that polls suggest his ruling Democratic Party of Japan will lose. Shinzo Abe, the leader of the main opposition Liberal Democratic Party, said yesterday the BOJ should pursue unlimited monetary stimulus to end deflation and revive the economy. Japan’s government today downgraded its view of the economy for a fourth month, the longest streak since the global financial crisis. Gross domestic product shrank last quarter at the fastest pace since 2011’s record earthquake.

The dollar headed for a five-day decline against the 17-nation currency before data forecast to show U.S. industrial production growth slowed, supporting the case for the Federal Reserve to continue stimulus measures. In the U.S., output at factories, mines and utilities probably rose 0.2 percent in October, after gaining 0.4 percent in the prior month, according to the median estimate of economists in a Bloomberg poll before the data release today. Reports due on Nov. 20 are expected to show existing-home sales, housing starts and residential permits all declined in October.

Fed Chairman Ben S. Bernanke said yesterday the U.S. central bank will take action to speed growth and a rebound in the nation’s housing market.

Singapore’s dollar fell after the government said growth this year will be at the lower end of its previous forecast.