Yen Falls to 2-Week Low Against Euro as Risk Appetite Improves

June 30 (Bloomberg) -- The yen fell to a two-week low against the euro after European reports showed an improvement in euro area confidence, boosting demand for higher-yielding assets.

The Swedish krona was the best performer against the dollar among the 16 most-traded currencies tracked by Bloomberg yesterday as investors purchased Scandinavian debt. The euro gained yesterday the most in four weeks versus the yen as a European Commission executive and consumer sentiment index rose, adding to signs record low rates are countering the recession.

“Risk appetite is on the menu,” said Alex Sinton, a senior dealer at ANZ National Bank Ltd. in Auckland. “At this point people are comfortable taking on board risk.”

The yen fell to 135.62 per euro as of 8:40 a.m. in Tokyo from 135.31 in New York yesterday, after earlier dropping to 135.74, the lowest level since June 15. Japan’s currency was at 96.16 per dollar from 96.06. The dollar bought $1.4104 per euro from $1.4083. It was little changed at 7.66 per krona.

The krona rose 1.8 percent to 7.66 versus the dollar yesterday as Swedish debt advanced. The yield on the 4.25 percent bond due in March 2019 declined for a seventh day, dropping 0.02 percentage point to 3.44 percent. Prices move inversely to yields.

The yen dropped 1.7 percent to 12.28 versus the South African rand and depreciated 2.4 percent to 12.50 against the krona after the European Commission said in Brussels yesterday that an index of executive and consumer sentiment in the 16 nations that use the euro advanced this month to 73.3, the highest level since November, from a revised 70.2 in May.