The dollar and the yen declinedagainst higher-yielding currencies as stocks rallied around theworld on optimism European leaders are nearing an agreement tocontain the debt crisis, damping demand for refuge assets.
The euro snapped a two-day advance versus the dollar before Italy, Spain and the Netherlands hold debt auctions and as Greeklawmakers prepare to vote on a property tax, crucial to securingthe nation’s next aid installment. South Korea’s won, the SouthAfrican rand and New Zealand’s dollar were the best performersagainst the greenback as traders awaited data that is forecastto show U.S. consumer confidence stayed near a two-year low.
“A sizable plan that is credible would provide sometemporary respite to the market,” said Chris Scicluna, deputyhead of economic research at Daiwa Capital Markets Europe inLondon. “We think this will be a temporary let up in risk aversion, which has benefited the most liquid safe-havencurrencies like the dollar and the yen.”
The dollar traded little changed at $1.3523 per euro at8:43 a.m. in London and bought 76.38 yen, from 76.36 yesterday.The 17-nation euro fetched 103.33 yen from 103.34 yen, aftertouching 101.94 yesterday, the least since June 2001.
The U.S. currency weakened 1.3 percent to 7.9529 rand fromits previous London close, and lost 1.6 percent to 1,173.55 won.New Zealand’s dollar rose 1 percent to 78.78 U.S. cents, asecond day of gains, while Australia’s dollar advanced 0.5percent to 98.86 cents.
The MSCI Asia Pacific Index of shares jumped 4 percent ascopper rebounded from a 14-month low while gold, platinum andoil advanced. The Stoxx Europe 600 Index climbed 2 percent,taking is advance over the past three days to 4.5 percentfollowing its slump to a two-year low on Sept. 22.