The US dollar and yen fell against most of their major counterparts after data showing growth in economies from China to the US boosted demand for higher-yielding assets.
“We’ve certainly seen rays of sunshine as far as risk sentiment is concerned,” said Vassili Serebriakov, a currency strategist at Wells Fargo & Co in New York. “You get a sense that growth in Asia is slowing from very strong levels, but remains firm, and the US growth is very modest, but the economy should be steering clear of a double-dip recession.”
The US dollar fell 1.1 percent to ¥84.31 on Friday, from ¥85.22 on Aug. 27, in its third straight weekly drop, the longest slide in two months. The greenback weakened 1 percent to US$1.2896 per euro.
The yen was little changed versus the euro after rising in each of the previous three weeks.
The euro rose for a fourth day against the US dollar on Friday, the longest winning streak in five weeks.
The yen gained versus the dollar this week amid speculation that moves to increase credit-easing measures in Japan won’t curb the currency’s surge. It has gained 14 percent this year, the most among 10 developed-world counterparts, as investors sought it as a haven, Bloomberg Correlation-Weighted Currency Indices show. It touched a 15-year high, ¥83.60 per US dollar, on Aug. 24. A strong currency hurts Japanese exporters’ competitiveness.
The pound fell for a fourth week against the dollar, the longest run of losses since June, as reports showing that UK services grew at a slower pace and house prices dropped fueled concern the recovery will falter.
The pound was at US$1.5445 as of 5:15pm in London on Friday. It fell to US$1.5327 on Tuesday, the lowest level since July 23. The pound was at £0.8341 per euro, leaving it 1.5 percent weaker since Aug. 27.
The currency may extend losses before the central bank’s interest rates decision in the week ahead.
The Bank of England will keep its benchmark interest rate at a record low 0.5 percent and maintain its asset purchases at £200 billion on Thursday, according to economists surveyed by Bloomberg.
“Sterling continues to feel the heat from weaker UK numbers this week,” said Paul Robson, a senior foreign-exchange strategist at Royal Bank of Scotland Group PLC in London.
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