RTRS: FOREX-Yen up broadly as taste for risk starts to fade
The yen rose broadly on Thursday as weak U.S. economic data and falling share prices kept investors wary of risk even as countries embraced further monetary and fiscal stimulus to boost struggling economies.
European stocks snapped a three-day winning streak, weighing a bit on the euro, and the dollar shed gains booked Wednesday after the Federal Reserve left interest rates steady and did not offer new details about buying Treasury debt.
Worries about the world economy waxed after data showed U.S. orders for long-lasting items such as computers and appliances fell by a greater-than-expected 2.6 percent last month. A separate report showed Americans filing for first-time jobless benefits in the latest week also rose.
"These are weak numbers, showing the recession continues to drag and is even intensifying," said Andrew Bekoff, chief investment officer at LPB Capital LLC, a Doylestown, Pennsylvania-based wealth management firm. "This is negative for the dollar."
Early in New York, the dollar was down 0.7 percent at 89.77 yen and the euro was off 0.5 percent at 118.19 yen . The Japanese currency gains when risk appetite fades and investors take refuge in its low but steady returns.
The euro edged up 0.2 percent to $1.3160 , off a global session low of $1.3029, and analysts said weak U.S. data could lead to a euro assault on the $1.33 area.
Sterling rose 1 percent to $1.4360 , boosted, traders said, by month-end flows that outweighed gloomy news about the UK economy.
Economic concerns overshadowed news that the U.S. House of Representatives approved President Barack Obama $825 billion economic stimulus package, though it did so without a single Republican vote. The bill now faces a vote in the Senate.
The euro was dented slightly by comments from European Central Bank President Jean-Claude Trichet, who told CNN that the ECB could cut euro-zone rates below the current 2 percent and adopt unconventional measures to boost the economy.
"A lot of people thought that the ECB was ruling out quantitative easing, but Trichet's comments suggest otherwise," said Adarsh Sinha, currency strategist at Barclays in London, adding that the euro would stay on the back foot.
Euro-zone data on Thursday showed German unemployment posted its biggest increase in nearly four years this month while euro-zone economic sentiment dipped to the lowest level since record-keeping began in 1985.
