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US focus: Yen falls to three-week low versus the Dollar
31.03.2011 10:56:00

The yen fell to almost a three-week low versus the dollar amid demand for higher-yielding assets.The Japanese currency weakened for a fifth straight day against the dollar as a private report showed U.S. companies added 201,000 jobs in March, fueling speculation the Federal Reserve may curtail its debt buying. The private report precedes the Labor Department’s nonfarm payroll numbers to be released April 1. U.S. payrolls added 190,000 in March, according to the median estimate of economists. Japan’s currency has weakened 2.3% against the dollar in the first quarter and 7% against the euro. Those declines accelerated in March with the yen losing 2.6% against the dollar and 1.6% to the euro in the past nine days.“Interest-rate differentials weigh against the yen,” said Jon Wetreich, currency strategist at Brown Brothers Harriman & Co.. “The European Central Bank couldn’t be any more clear that rates are going up. The Bank of England has been reasonably hawkish, and now we’re getting comments from certain Fed members indicating, not that rates are going up anytime soon, but everyone is getting the news that quantitative easing is over.”Europe’s common currency has strengthened 5.2% versus the dollar this year as euro-region policy makers stiffened their anti-inflation views. The ECB will increase its main refinancing rate by a quarter-percentage point to 1.25% at its April 7 meeting, according to the median forecast of economists.

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