Yen rises against euro, dollar

ASIAN CURRENCIES ROUND-UP

The yen rose against all but one of the 16 most active currencies as a decline in Asian and European stocks prompted investors to reduce holdings of higher-yielding assets bought with loans from Japan.

The Japanese currency extended its gain versus the euro this year to 4.8 per cent and rose by the most this month against the dollar as investors reduced so-called carry trades.

The Australian dollar climbed after the nation's central bank said it's likely to keep raising borrowing costs. The euro rose against the US currency after European Central Bank President Jean-Claude Trichet said "economic fundamentals are sound.''

"We still haven't gone past the period of risk aversion and the carry trade is coming under pressure,'' said Niels From, foreign-exchange strategist in Frankfurt at Dresdner Kleinwort, the investment bank owned by Allianz SE, Europe's biggest insurer. "The yen could strengthen somewhat.''

The yen rose to 155.37 a euro by 8:51 am in London, from 155.71 late in New York on February 8. Japan's currency climbed as much as 0.7 per cent against the dollar, the most since January 30, and was trading at 106.64, from 107.30. The yen may end the year at 105 to the dollar, From said.

The MSCI World Index lost as much as 0.3 per cent on Monday, while the Euro Stoxx 50 Index, a benchmark for the euro area, declined 0.6 per cent.

Korea's won falls on export outlook
South Korea's won fell on speculation that a global economic slowdown will hurt the region's exports.

The Korean currency fell the most in almost three weeks as Group of Seven officials warned of further financial market turmoil and signalled that they're ready to cut interest rates and taxes to counter the decline. The Philippine peso declined for a second day and the Malaysian ringgit fell the most since January 21.