Yen Falls, Set for 4th Weekly Loss Against Euro, as Stocks Rise


Staff member
Nov 30, 2008
The yen fell, heading for a fourth weekly decline against the euro, as shares rallied on speculation the global credit crisis is easing, damping demand for the Japanese currency as a refuge.

The euro was poised for its biggest weekly gain versus the dollar this year after European Central Bank council member Yves Mersch said he doesn’t see deflation risks in the 16-nation region, tempering concern policy makers will cut interest rates. The Swiss franc was set for its largest weekly loss against the euro since 1999 after the Swiss National Bank yesterday cut its key rate close to zero and started buying foreign exchange to stem its currency’s appreciation.

“Emerging signs of a rebound of stocks are improving the appetite for risk” and weakening the yen, said Yasuhide Yajima, senior economist in Tokyo at NLI Research Institute Ltd., a unit of Japan’s second-largest life insurer. “Growing confidence is prompting capital inflows into the currencies of resource-rich nations and emerging markets.”

The yen dropped to 126.56 versus the euro as of 7:35 a.m. in London from 126.16 late in New York yesterday. It earlier touched 126.67, the weakest level since Jan. 7. The Japanese currency fell to 98.04 per dollar from 97.72. The dollar was little changed at $1.2911 against the euro from $1.2913.

From Bloomberg News.