Yen withers in Asia

The yen slid to a 10-month low against the euro and fell below its 200-day moving average versus the dollar on Friday, poised for more weakness as widening yield differences increased the appeal of using the yen to fund investments in other currencies.
The yen came under renewed pressure after comments from a US Federal Reserve official gave traders more reason to think the Fed will raise interest rates before the Bank of Japan, underscoring the diverging outlook for their monetary policies. The BOJ will likely lag behind the Fed and the European Central Bank in raising interest rates, especially in the wake of the March 11 earthquake and tsunami that devastated Japan's north-east. Such market expectations have stirred talk of a revival in the yen carry trade, which involves selling the low-yielding yen to fund investment in higher-yielding currencies and assets.
"The global economy is in relatively good shape, equities are performing solidly and volatility has been low," said Koji Fukaya, director of global foreign exchange research at Credit Suisse Securities in Tokyo. The dollar rose above its 200-day moving average against the yen at 83.63 yen for the first time since June, a sign that the yen's uptrend may be coming to an end.
The dollar was up 0.5 percent to 83.56 yen. It touched a six-week high of 83.748 yen on trading platform EBS earlier, and the next major peak on daily charts is its mid-February peak of 83.98 yen. The dollar tumbled to a post-World War Two record low of 76.25 yen in March, as the yen surged on the back of market speculation that Japanese investors may repatriate funds from abroad after the earthquake.
There has been little sign that such repatriation has taken place, and the yen later fell back after the Group of Seven industrialised nations intervened jointly to sell the yen on March 18. Japan conducted a total of 692.5 billion yen ($8.4 billion) in FX intervention in March, the Ministry of Finance said on Thursday. The yen fell broadly on the crosses, hitting an 11-month low against the Australian dollar and its lowest in more than 10 months against the euro.
The single European currency rose as high as 118.675 yen on trading platform EBS, the euro's highest since against the yen since mid-May 2010. The euro last stood at 118.40 yen, up 0.6 percent on the day. The dollar gained a lift against the yen after the Wall Street Journal reported that Minneapolis Federal Reserve President Narayana Kocherlakota signalled the Fed could raise interest rates by three-quarters of a percentage point by the end of the year. The Australian dollar rose 0.2 percent to $1.0346, hovering near a 29-year high of $1.0373 hit on Thursday.