Yen and Gold Continue their Declines

The lira jumped the most since 2008 while the yen and gold extended declines after Turkey’s central bank more than doubled interest rates to arrest a currency slide that roiled global markets. Japanese and U.S. stock index futures climbed while crude oil retreated.

The lira surged 3 percent versus the greenback by 1:35 a.m. in Istanbul, sending the yen lower versus major peers while New Zealand’s dollar climbed. Gold slipped 0.4 percent in a third day of declines. Nikkei 225 Stock Average futures were bid 1.3 percent higher in the Osaka pre-market and Australian stocks snapped a four-day slide. Standard & Poor’s 500 Index (SPX) futures climbed 0.5 percent after the gauge rose 0.6 percent. Oil in New York dropped from a four-week high and natural gas fell.

The lira’s slide to a record low coupled with Argentina’s devaluation of the peso and concern over China’s economy ignited a rout in world equity markets at the end of last week. BlackRock Inc. said the “sharp” rate rise would slow Turkey’s economy though is a welcome first step. Federal Reserve policy makers end their two-day meeting today, with economists polled by Bloomberg Jan. 10 projecting a second $10 billion cut to the record bond buying program that has supported emerging markets.


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