The yen rose to the strongest level versus the euro since May 2002 and traded near a 13-year high against the dollar as global economic turmoil encouraged investors to sell higher-yielding assets funded in Japan.
French Finance Minister Christine Lagarde said in an interview with Bloomberg News that the Group of Seven doesn't plan to intervene to weaken the yen after the G-7 said in an unscheduled statement that excessive movements in the currency may threaten financial stability. The pound slid after an industry report showed U.K. house prices slumped.
In the past month, Japan's currency has increased 14 percent against the dollar, 33 percent versus the euro, 55 percent versus the Australian dollar and 44 percent against the New Zealand dollar on speculation investors will unwind carry trades, in which they get loans in countries with low borrowing costs and seek higher returns elsewhere.
Stocks in Asia and Europe tumbled as investors bet the credit crisis and mounting bank losses will lead to a global recession. Hong Kong's Hang Seng Index sank as much as 15 percent, and trading was halted in the Philippines and Thailand. The Standard & Poor's 500 Index gained 0.1 percent.
The euro stayed lower against the dollar and the yen after a survey by the Ifo institute showed business confidence in Germany, the largest of the 15 economies sharing the currency, declined to the lowest level in more than five years in October. European Central Bank President Jean-Claude Trichet said policy makers may cut interest rates at their Nov. 6 meeting.
The dollar is reasserting its status as the world's reserve currency as investors seek a haven from plunging emerging-market stocks and bonds. The ICE futures exchange's Dollar Index, which tracks the greenback against the currencies of six major trading partners, soared to the highest in more than two years. The sell-off in emerging markets may ``set the stage'' for bigger gains, according to Barclays Capital.
EUR/USD the pair on results of session has slightly decreased. Having opened the tenders of week in the field of $1,2530, the pair could update two years low on $1,2330 then has receded above a level $1,2450.
GBP/USD having tested six years low on $1,5265, the pair has returned above a level $1,5500.
USD/JPY the rate bargained within the limits of Y92,00-Y94,40.
European data for Tuesday starts at 0710GMT with German Gfk consumer confidence data. UK data at 1100GMT sees September Land Registry House Prices as well as the CBI distributive trades survey.
At 14:00 GMT will be published US Consumer confidence (October).
At 21:45 GMT trade balanc of New Zealand will be published.