The dollar, yen and Swiss franc weakened against most of their major counterparts after reports showed manufacturing from China to Europe exceeded estimates, reducing demand for safer assets. Sweden’s krona led gains versus the greenback as stocks rallied from Asia to Europe, increasing the appetite for higher- yielding investments. The euro rose for a third day against the yen after a gauge of euro-area manufacturing exceeded forecasts, before paring its advance after a separate report showed German investor confidence fell. Japanese Finance Minister Yoshihiko Noda said gains in the yen may hurt the nation’s recovery, raising prospects officials will act to curb its appreciation. “The market’s perception seems to be changing on a daily basis but we’re definitely seeing a move into riskier currencies and asset classes,” said Chris Huddleston, a trader at Investec Bank Plc in London. “The general feeling seems to be that there’s slightly less potential for another global recession and the dollar in particular is being sold against anything that’s higher-yielding.” The dollar weakened 0.6 percent to $1.4449 per euro as of 10:09 a.m. in London, and lost 0.2 percent to 76.65 yen. Sweden’s krona rallied 0.9 percent to 6.2815 per dollar. The euro gained 0.4 percent to 110.74 yen, and added 0.3 percent to 1.1387 to the Swiss franc. Stock Gains The Stoxx Europe 600 Index added 1.6 percent and futures on the Standard & Poor’s 500 Index gained 1.5 percent as the better-than-estimated manufacturing data helped ease concerns the global economy is slowing. Higher-yielding assets also gained amid speculation the Federal Reserve will this week announce further monetary stimulus to bolster the U.S. economy. A preliminary gauge of Chinese manufacturing in August was 49.8, according to a reading of the Purchasing Managers’ Index reported by HSBC Holdings Plc and Markit Economics today. The final figure for July was 49.3. A number below 50 shows a contraction, and the final number for August is due Sept. 1. Germany’s manufacturing purchasing managers’ index was 52 in August, exceeding the 50.6 median forecast in a Bloomberg survey, Markit Economics said today. A composite index of euro- area purchasing managers in services and manufacturing industries stayed at 51.1 in August, Markit said. That was above the median estimate of 50 predicted in a Bloomberg survey. The ZEW Center for European Economic Research said its index of investor and analyst expectations, which aims to predict developments six months in advance, dropped to minus 37.6 from minus 15.1 in July. Economists expected a decline to minus 26, according to a Bloomberg survey. Bernanke’s Speech Fed Chairman Ben S. Bernanke is scheduled to speak on Aug. 26 in Jackson Hole, Wyoming, amid speculation he will signal additional steps to boost the U.S. economy. “A big focus for the market this week will be what Bernanke says at Jackson Hole,” said You-na Park, a currency strategist at Commerzbank AG in Frankfurt. Japan’s yen fell against 13 of its 16 major counterparts after Finance Minister Noda said he is examining how much speculative trading is influencing the currency, which surged to a post-World War II record of 75.95 per dollar on Aug. 19. Measures to address the yen may be needed in the government’s budget, Noda added. “There is a little bit of fear in the market for an intervention from the Bank of Japan,” said Tsutomu Soma, a bond and currency dealer in Tokyo at Okasan Securities Co. “Investors can’t aggressively buy the yen now as much as they want because some big events are ahead, such as Bernanke’s speech and the leadership election for the ruling party.” Kan to Resign Prime Minister Naoto Kan told his cabinet today that he will resign after the passage of legislation including a deficit-covering bond bill, Kyodo News reported, without saying where it got the information. Kan said a new prime minister will probably be decided on Aug. 30, according to the report. His Democratic Party of Japan, which is set to elect its third leader since coming to power in 2009, will have to cope with the threat that the appreciation of the yen poses to an export-led recovery. Japan’s exports dropped a larger-than-forecast 3.3 percent in July from a year earlier, and the economy shrank an annualized 1.3 percent in the third quarter, government data showed last week. To contact the reporter on this story: Garth Theunissen in London gtheunissen@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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