Yen weakens on return to risk

Yen weakens on return to risk

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The Japanese yen was weaker over the week as recovering equities markets made investors more comfortable with risk again and they began to sell the currency to finance carry trades.

While the yen dropped 0.7 percent to ¥233.15 against sterling, it was 1.5 percent lower to ¥162.60 versus the euro, fell 3 percent to ¥99.90 in relation to the Australian dollar and was down 4.6 percent to ¥85.87 against the New Zealand dollar.

Even the weakening US dollar was 0.1 percent higher in relation to the yen, to ¥115.40 as it fell versus other currencies after the Federal Reserve cut US interest rates by 0.5 percent to 4.75 percent.

The greenback dropped 1.5 percent over the week to $1.4120 in relation to the euro on Friday, a new record low, while it lost 0.6 percent during the week to $2.0185 versus the pound, was down 1.3 percent to SFr1.1730 against the Swiss franc, and plummeted 3.5 percent to C$0.9939 versus the Canadian dollar.

Sterling was down to £0.7020, the lowest it has been against the euro in over two and a half years before it recovered to trade at £0.6975 for a drop against the shared currency of 0.8 percent on the week.