Asian markets headed lower, following Wall Street’s cue, after the International Monetary Fund (IMF) cut its global growth forecasts. The IMF slashed its outlook for the third time this year, due to weakness in core eurozone countries, Japan, and emerging markets such as Brazil.
In Japan, the Nikkei 225 was down 1.2%, hitting a five-week closing low. But, investors pushed up the yen in safe-haven trade, as it strengthened to a three-week high against the dollar.
The euro slipped to its lowest level in a month against the yen, at 136.56, after German data showed industrial output in August fell 4% compared with the previous months. That marked the biggest decline since the height of the financial crisis. “Weak numbers like the German production report fuel concern that European Central Bank stimulus will be inadequate given the gloomier news,” said Westpac analyst James Shugg.
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