Yen down on ECB move

Story link: Yen down on ECB move

Japan’s yen declined in relation to a number of currencies on Tuesday after a huge injection of cash into the banking system by the European Central Bank sent investors back to risky carry trades.

The ECB put $500 billion, a record, into the system, a day after the US Federal Reserve held the first of its cash auctions on Monday and on the same day that the Bank of England offered £10 billion for three-month loan.

Among the declines the yen dropped the most against the Brazilian real, trading at ¥62.605 to the real in early afternoon trade in New York.

Elsewhere, the yen traded at ¥113.3200 to the US dollar, at ¥163.2658 to the euro, at ¥228.0677 to the pound, and at ¥97.2965 to the Australian dollar.

The pound was weaker versus the euro on concerns that the Bank of England will cut interest rates again soon after new data showed that inflation was lower than had been expected in November.

It took €1.3969 to buy a pound in New York, while the US dollar traded at $2.0126 to the pound.

The dollar was about even versus the euro after more bad news from the US housing market, trading at $1.4407 to the euro.

US housing starts were down in November but not as much as had been predicted, while construction permits were down 1.5 percent last month.

The Canadian dollar was weaker, trading at C$1.0069 to the dollar, at C$1.4506 to the euro, and at C$2.0264 to the pound after new data showing that consumer prices grew by 1.2 percent in the year ending in November.