By Ron Harui and Stanley White Nov. 12 (Bloomberg) -- The yen fell as U.S. stock futures gained and Asian money-market rates declined, giving investors confidence to increase holdings of higher-yielding assets financed in Japan. The euro rose versus the dollar, following a 1.8 percent decline yesterday, as a technical chart that traders use to predict price movements signaled the loss was overdone. The yen also dropped against the Australian and New Zealand dollars, two favorites of so-called carry trades, on speculation central bankers will urge more action to stem the global credit crisis. ``U.S. stock futures are gaining, indicating some improvement in risk-taking appetite,'' said Lee Wai Tuck, a currency strategist at Forecast Pte Ltd. in Singapore. ``The yen is being sold a bit.'' The yen dropped to 123.35 per euro at 6:51 a.m. in London from 122.27 late in New York yesterday. It was little changed at 97.81 against the dollar. The euro gained to $1.2613 from $1.2522. It had reached $1.2477, the lowest since Oct. 28. The British pound advanced to $1.5465 from $1.5384. Against the yen, the Australian dollar climbed 1.1 percent to 64.87 from 64.17 late in New York yesterday, and the New Zealand dollar strengthened 1.2 percent to 56.57 from 55.91. The Swedish krona gained 1 percent to 12.215 yen and the Danish krone rose 0.7 percent to 16.5446 yen. The yen dropped against 14 of the 16 most-active currencies after the Standard & Poor's 500 Index futures climbed 1.3 percent. In carry trades, investors get funds in a country with low borrowing costs and buy assets where returns are higher. Japan's 0.3 percent target lending rate compares with 5.25 percent in Australia and 6.5 percent in New Zealand. Money Market Rates Demand revived for carry trades as money-market rates extended declines after Asian central banks injected cash into the financial system. Hong Kong's three-month interbank offered rate, known as Hibor, fell 5.5 basis points to a five-month low of 2.04 percent. The similar rate in Australia declined to 4.835 percent from 4.915 percent yesterday as the central bank pumped A$1.48 billion ($976 million) into money markets. Financing costs dropped from last month's peaks as central banks provided unlimited dollar funding and governments offered bailouts and guarantees to financial institutions. Credit markets, which began seizing up after BNP Paribas SA halted withdrawals on three funds in August 2007, froze after Lehman Brothers Holdings Inc. collapsed on Sept. 15, reducing lenders' confidence they would be repaid. European Central Bank executive board member Jose Manuel Gonzalez-Paramo speaks at 9 a.m. in Paris today. Federal Reserve Vice Chairman Donald Kohn speaks at 5 p.m. in Luxembourg. `Slide Looked Overshot' The euro rose from a two-week low against the dollar as its 14-day stochastic oscillator was 20.03 yesterday. A level below 20 suggests a security has fallen too fast. ``The currency has been sold quite a lot, so its slide looked overshot,'' said Ryohei Muramatsu, manager of Group Treasury Asia at Commerzbank AG in Tokyo. ``Some buying back probably occurred.'' Losses in the U.S. dollar may be limited after prices fell for the commodities which Australia and New Zealand export and as Standard & Poor's cut South Africa's ratings outlook. The ICE's Dollar Index, which tracks the greenback against six trading partners, was at 86.779 from 87.075 yesterday, when it reached 87.279, the highest since Oct. 28. The Bloomberg UBS Constant Maturity Commodity Index of 26 raw materials dropped 3.6 percent yesterday. Standard & Poor's cut its outlook on South Africa's BBB+ credit rating to ``negative'' from ``stable.'' ``There's negative news from Oceania and South Africa, so I see the dollar rebounding against these currencies,'' said Takeshi Iba, vice president of foreign exchange in Tokyo at BBH Investment Services Inc., a unit of Brown Brothers Harriman. To contact the reporters on this story: Ron Harui in Singapore at rharui@bloomberg.net; Stanley White in Tokyo at swhite28@bloomberg.net

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