Finance News Update, what you need to know

WORLD FINANCE UPDATE:

The Australian dollar has firmed, reaching a seven-year high against the Japanese yen ahead of economic data from Australia's second biggest trading partner.

At 0630 AEDT on Monday, the local currency was trading at 87.64 US cents, up from 86.84 cents on Friday.

And the Australian share market looks set to open higher after Wall Street finished mainly slightly higher.

At 0645 AEST on Monday, the December share price index futures contract was up six points at 5,475.

ELSEWHERE:

TOKYO - Economic data due in Japan looks likely to determine the fate of "Abenomics", with expectations poor third-quarter GDP figures will prompt a snap election.

BRUSSELS - The European Union has failed to make progress in negotiations on how much the bloc should spend in 2015, with its governments struggling to even set out their position for the talks despite a looming deadline.

WASHINGTON - In a rarity for a US central bank chief, Federal Reserve Chair Janet Yellen has met with activist groups calling for a fairer economic recovery and a more transparent Fed.

RIO DE JANEIRO - Federal police have sharply expanded what is becoming Brazil's biggest political kickback scandal, arresting top construction company executives and detaining another former director of the state-run energy company.

NEW YORK - Microsoft has surpassed Exxon to become the second-most valuable company in the world.

BRUSSELS - The European Commission has approved a deal that will allow Etihad Airways to take a 49 per cent stake in Alitalia, effectively rescuing the struggling Italian company.

BOISE, Idaho - The US Department of Agriculture has approved Idaho-based JR Simplot Co's new genetically modified potato.

NEW YORK - US toymaker Hasbro has ended talks to buy DreamWorks Animation, the film studio which produced the blockbuster series "Shrek," the New York Times reports.