Yen Rises Against Euro, Dollar

The yen rose against all but two of 16 most-active currencies as a decline in Asian and European stocks prompted investors to reduce holdings of higher-yielding assets bought with loans from Japan.

Japan's currency extended its gain versus the euro this year to 4.6 percent and climbed by the most in more than two weeks against the dollar as investors reduced so-called carry trades. The Australian dollar advanced after the nation's central bank said it's likely to keep raising borrowing costs. The euro rose against the dollar after European Central Bank President Jean- Claude Trichet said ``economic fundamentals are sound.''

The yen strengthened to 155.35 per euro by 6:45 a.m. in New York, from 155.71 on Feb. 8. Japan's currency climbed as much as 0.9 percent, the most since Jan. 23, and was at 106.73 per dollar, from 107.30. The euro traded at $1.4554, from $1.4504, after falling 2 percent last week, the most since September 2006.

The MSCI World Index lost as much as 0.3 percent today and was near the lowest level since Jan. 24. The Dow Jones Stoxx 600 Index for the euro area declined 0.2 percent. U.S. shares last week had their first drop since the five days through Jan. 18

Yen Rises Against Euro, Dollar, Bloomberg
2/11/2008 7:05:14 AM