Dollar Falls to 3-Year Low against Yen

The dollar declined to a three-year low against the yen on speculation the Federal Reserve will signal plans to keep cutting interest rates to avert a recession.

The currency broke below 103 yen for the first time since January 2005 and approached a record low against the euro before speeches by two Fed policy makers and an industry report that may show U.S. manufacturing contracted. The dollar fell last week against the euro by the most since December after Fed Chairman Ben S. Bernanke said some small banks may fail and unemployment will increase.

The dollar fell to 102.93 yen, the lowest since Jan. 28, 2005, before trading at 103.10 at 11:35 a.m. in Tokyo, from 103.74 late in New York on Feb. 29. It declined to $1.5198 against the euro from $1.5179 in New York at the end of last week, when it fell to $1.5239, the lowest since the common European currency's introduction in January 1999. The euro traded at 156.68 yen from 157.46.

The dollar weakened to a record low of 1.0323 Swiss francs from 1.0412 and declined to 5.2062 Norwegian kroner compared with 5.2131. Against the Canadian dollar, the U.S. currency dropped to C$0.9856 from C$0.9878.

Dollar Falls to 3-Year Low against Yen, Bloomberg
3/2/2008 7:05:11 PM