The yen and franc declined before a report that is forecast to show U.S. economic growth quickened and as stocks rose, denting demand for the perceived safety of the Japanese and Swiss currencies. The franc retreated from a record high against the dollar on speculation the Libyan rebellion won’t trigger an oil-price rally sufficient to dent the global economic recovery. The pound slumped to its weakest level this month against the euro after a report showed Britain’s economy shrank more than initially estimated in the fourth quarter. New Zealand’s dollar rose after Standard & Poor’s said the earthquake in Christchurch would have no immediate effect on the nation’s credit rating. “The yen is overbought, and there’s potential for further losses once the crisis is resolved,” said Jane Foley, a senior currency strategist at Rabobank in London. The franc weakened 0.2 percent to 1.2805 per euro at 10:53 a.m. in London, paring its advance this week to 1 percent. It depreciated 0.3 percent to 92.91 centimes per dollar after reaching 92.28, the strongest since at least 1971, when Bloomberg records begin. The yen strengthened 0.2 percent to 82.87 per Australian dollar. It was little changed at 112.89 per euro and 81.92 per U.S. dollar. The euro was 0.1 percent weaker at $1.3780. Losses by the yen may be limited as the Libyan crisis “is clearly not resolved yet and the market won’t want to leave a lot of risk open over the weekend,” Foley said. Libyan Violence U.S. gross domestic product probably grew at a 3.3 percent annual rate in the fourth quarter, Commerce Department figures will show today, according to the median prediction of 75 economists surveyed by Bloomberg. That’s higher than an initial estimate of 3.2 percent reported on Jan. 28. The yen and franc strengthened this week as violence in Libya spurred demand for safer assets. Libyan leader Muammar Qaddafi, who has lost control of much of his country’s oil-rich east, appealed on state television to citizens to end violence as his forces stepped up a crackdown on opponents. The nation holds Africa’s largest crude oil reserves. The yen has risen 1.5 percent this week against the dollar, the biggest gain this year, while the franc advanced 1.6 percent. The pound declined for a sixth day against the euro, losing 0.2 percent to 85.71 pence, after depreciating to 85.93, the weakest level since Jan. 31. Sterling slumped 0.4 percent to $1.6073, down 1.1 percent since Feb. 18. U.K. GDP U.K. gross domestic product contracted 0.6 percent in the fourth quarter, the Office for National Statistics said today, more than the Jan. 25 estimate of a 0.5 percent drop. New Zealand’s dollar strengthened against 12 of its 16 major counterparts after S&P said the nation’s credit rating was not “immediately affected” by the deadliest earthquake in 80 years. The statement “helped the kiwi lift a little,” said Alex Sinton, a senior dealer at ANZ National Bank Ltd. in Auckland. “There’s a short-covering rally with probably more to go.” Short-covering is where investors end a bet that an asset will decline. The kiwi rose 0.2 percent to 74.92 U.S. cents, and 61.34 yen. To contact the reporters on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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