Yen Falls as Confidence Edges Back, Stocks Rally


The yen fell broadly on Friday as a rally in global stocks fuelled appetite for riskier trades, putting the low-yielding Japanese currency under pressure.

Gains in high-yielding units such as sterling also underscored improved risk appetite as stocks rose across Europe and Asia, with Japan's benchmark Nikkei index .N225 surging over 4 percent in its biggest one-day gain in about six years.

Stock investors were cheered by a U.S. tax stimulus package, reassuring U.S. jobs data and the prospect of another U.S. Federal Reserve interest rate cut next week, all tending to ease fears that the world's biggest economy will slip into recession.

Stock market moves are often regarded as a barometer of risk appetite, and financial markets have calmed down after swinging wildly earlier in the week on the Fed's rate cut and escalating fears of a U.S. recession.


TradingEconomics.com, Reuters
1/25/2008 6:39:18 AM