The euro rose from a decade low against the yen and strengthened versus the dollar after the Group of 20 nations pledged a “strong and coordinated” response to challenges facing the global economy. The U.S. and Japanese currencies weakened against most of their major counterparts as European shares and U.S. stock futures rallied, sapping demand for safer investments. The euro still headed for fourth weekly loss versus the yen after Moody’s Investors Service downgraded the debt ratings of eight Greek banks. The Australian dollar and New Zealand dollars appreciated after falling to five-month lows yesterday. “The euro suffered from the dramatic risk sell-off yesterday but with things stabilizing now it’s recovered somewhat,” said Steven Saywell, head of foreign-exchange strategy for Europe at BNP Paribas SA in London. “All eyes are still on Europe and what the policy response will be. There are still a lot of uncertainties about the debt market.” The euro gained 0.4 percent to 103.04 yen at 10:36 a.m. in London, paring its weekly loss to 2.8 percent. The shared currency fell to 102.22 yesterday, the weakest level since 2001. It rose 0.4 percent to $1.3520, trimming this week’s loss to 2 percent. The yen was little changed at 76.22 per dollar. The Stoxx Europe 600 index added 0.1 percent, and futures on the Standard & Poor’s 500 Index rose 0.5 percent. ‘Strong’ Response The G-20 nations are “committed to a strong and coordinated international response to address the renewed challenges facing the global economy,” finance chiefs said in a statement released after talks in Washington. The European Central Bank may act to address risks to growth as soon as next month should economic data disappoint, Governing Council member Luc Coene said in an interview in Washington yesterday. Potential measures include the reintroduction of longer-term bank loans, with maturities of 12 months or even longer, he said. Traders sold euros this week on concern Europe won’t contain its debt crisis, even after Greece accelerated budget cuts to qualify for next month’s payment under a 110 billion- euro international bailout. The euro was boosted today by speculation Asian central banks were active in foreign-exchange markets after the region’s currencies slumped this week, said Charles Han, director of foreign-exchange trading at Newedge Financial HK Ltd. “Not only have they been buying euro but also, in Korea specifically, they’ve been selling dollars to help smooth volatility,” Hong Kong-based Han said. Aussie, Kiwi The Australian dollar snapped a two-day decline versus the U.S. currency after Standard & Poor’s Ratings Services affirmed the South Pacific country’s AAA credit rating. New Zealand’s currency rose as a technical indicator signaled its recent losses were too rapid. Investors who bet the Australian dollar would decline from above parity are “probably happy to take profit ahead of the weekend in case something does get agreed on from the G-20,” said Jonathan Cavenagh, a Singapore-based strategist at Westpac Banking Corp. “The market’s really looking for some type of circuit breaker to get out of this risk-averse mode that we’re in at the moment.” Australia’s dollar jumped 0.8 percent to 98.21 U.S. cents, after slipping to 96.92 cents yesterday, the weakest since Dec. 2. New Zealand’s currency rose 0.3 percent to 78.27 cents. The South Korean won appreciated, paring its worst week in 16 months, after authorities said they would intervene to slow its decline. The finance ministry said it would “take action” to stabilize the currency market, after holding an emergency meeting with the central bank before markets opened. The won gained 1.1 percent to 1,167.31 per dollar, paring its weekly slump to 4.7 percent. The yen has appreciated 11 percent over the past three months, the best performer among the 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Currency indexes. The dollar, the second-best performer, gained 4.8 percent while the euro has lost 1.1 percent. To contact the reporters on this story: Garth Theunissen in London gtheunissen@bloomberg.net; Candice Zachariahs in Sydney at czachariahs2@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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