Euro gains on G20 promise

The euro and the dollar gained against the yen this morning after the Group of 20 decided not to criticise Japan for its expansionary policies, but Europe's weak growth outlook and the approach of Italian elections capped the moves.

The euro gained 0.15 per cent to 125.20 yen, edging up toward a 34-month high of 127.71 yen hit earlier this month, while the dollar rose 0.5 per cent to 93.99 yen, closer to its highest since May 2010 of 94.46 hit on February 11.

With the G20 meeting over, the focus in European markets is switching to the release of euro area purchasing managers' indexes for February and German sentiment indices due later in the week, and the upcoming general elections in Italy.

Analysts expect the euro area flash PMI indices, which point to economic activity around six months out, to show growth stabilising rather than a clear end to the current recession across the region.

The FTSEurofirst 300 index of top European shares opened down 0.1 per cent at 1,159.87 points, with Germany's DAX , the UK's FTSE and France's CAC flat to slightly weaker.

Earlier, the effect of the G20 statement and further announcements from Japan's prime minister Shinzo Abe indicating a renewed drive to stimulate the economy lifted the Nikkei stock index by 2.1 per cent, near to its highest level since September 2008.

Meanwhile US stock futures were barely changed and are expected to stay little changed as Wall Street will be closed today for the Presidents' Day holiday.

Reuters