Yen under pressure in Asia as calm tiptoes back
TOKYO (AFP) - The yen came under pressure in Asian trade Friday as investors gradually returned to risky bets following recent market turbulence, dealers said.
"Stability has returned momentarily to the market with investors taking a breather while regaining some of their appetite for risk," said Kazuhiko Shibata, Tokyo branch manager at Dresdner Bank.
Investors were inching their way back to high-risk bets known as "carry trades," dealers said. A carry trade is when the yen is used as a source of low-cost funding for higher-yielding assets elsewhere.
The Bank of Japan on Thursday left its benchmark interest rate at 0.5 percent -- the lowest of any major economy -- in the wake of the market turmoil.
The rout on global stock markets and currency markets last week and early this week had pushed up the yen as bearish players unwound risk, sending those high-yielding currencies tumbling down.
The dollar was steady at 116.26 yen in Tokyo morning trade from 116.28 in New York late Thursday.
The euro was also stable at 1.3562 dollars from 1.3566 and at 157.61 yen from 157.76.
The yen slipped more sharply against higher-yielding currencies. The British pound firmed to 232.97 yen in early Tokyo trade from 231.84 in New York and the Australian dollar rose to 95.38 yen from 95.35, its highest level in three days.
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