Europe open: Stocks edge higher after Japanese FX intervention

Stocks are edging higher thanks to a pause in the single currency's recent rapid move higher after Japan's finance minister cautioned overnight against "big swings" in foreign exchange markets.

His comments led some analysts to wonder if at some point, or rather at which point, the European Central Bank might also take issue with the speed of gains in the euro, just as rate-setters in Frankfurt were beginning to spy an exit from their programme of bond purchases.

Against that backdrop, as of 0855 GMT the benchmark Stoxx 600 was higher by 0.15% or 0.60 points at 398.43, alongside a rise of 0.26% or 33.91 points to 13,234.42 on the German Dax and an advance of 0.08% or 4.55 points in the Cac-40.

Meanwhile, euro/dollar was dipping 0.24% to 1.2237.

Commenting on the price action in markets, Michael Hewson, chief market analyst at CMC Markets UK, said: "These changing expectations around the pace of stimulus withdrawal could well prove to be a headache for the ECB, given that the rise in the euro is likely to bear down on an already subdued headline inflation rate. The euro is already acting as a bit of a brake on the German DAX which has as yet been unable to get back to the highs it saw in November last year."

Triggering the latest bout of volatility in FX markets, and in what was interpreted as a 'verbal intervention' by traders, overnight Japanese finance minister Taro Aso said he did not see problems with the then current level of the Japanese currency versus the US dollar, at 110.80.

However, big swings would be problematic, Aso added.

His remarks came on the back of four consecutive weeks of losses in the US dollar which had also served to push the single currency to a three year high.

In terms of fresh economic data, the German Ministry of Finance reported that harmonised consumer prices in the euro area's largest economy rose by 0.8% on the month and 1.6% year-on-year in December, as expected.

Similarly, ISTAT confirmed its preliminary estimate that at the end of 2017 Italian consumer prices advanced at a 0.3% clip month-on-month, despite which the annual rate of gains slipped to 1.0%.

Later in the day, the Federal Reserve bank of New York will release its regional manufacturing gauge for the month of January.

Making headlines in the corporate space, according to the Journal, Airbus chief Tom Enders accused the Trump administration of protectionism and criticised Boeing for taking advantage of such sentiments.

Also in France, carmaker Peugeot posted a 15.4% jump in its global sales last year.

Deutsche Bank and eight other lenders were accused in a lawsuit of conspiring to rig a Canadian rate benchmark.