The yen slid to a seven-month low versus the euro after data showed Japan’s consumer prices stagnated last month, fanning speculation the central bank will increase stimulus to spur inflation. Japan’s consumer prices excluding fresh food were unchanged in October from a year earlier after a 0.1 percent decline in September, the statistics bureau said in Tokyo today. The BOJ has an annual inflation target of 1 percent. Economy Minister Seiji Maehara said today that concern over Japan’s economy is increasing and that he wants to cooperate with the BOJ to end deflation.

Shinzo Abe, leader of Japan’s opposition Liberal Democratic Party, yesterday reiterated his call for the Bank of Japan to pump unlimited cash into the financial system until inflation reaches 2 percent. Abe’s LDP had an approval rating of 23 percent, compared with 13 percent for the ruling Democratic Party of Japan, the Nikkei newspaper reported yesterday, citing a Nov. 26-28 opinion poll. The nation will hold elections on Dec. 16 for the lower house of parliament.

The dollar was near a one-month low against the euro as Democrats and Republicans wrangled over the spending cuts and tax increases of the so-called fiscal cliff looming for the U.S. in January. U.S. Treasury Secretary Timothy Geithner offered Republican House Speaker John Boehner a proposal to avert an end-of-the- year fiscal cliff that would trade $1.6 trillion in tax increases for $400 billion in unspecified entitlement-program cuts, a Republican aide said, who wasn’t authorized to speak publicly.

After meeting Geithner yesterday, Boehner said President Barack Obama must “get serious” about the fiscal cliff talks. Senate Majority Leader Harry Reid, a Nevada Democrat, said Democrats need a proposal from Republicans on what sort of spending cuts they want.

EUR/USD: during the Asian session, the pair rose to $1.3005.

GBP/USD: during the Asian session, the pair rose to yesterday's low.

USD/JPY: during the Asian session, the pair rose to Y82.55.