Yen Drops

Yen Declines as JPMorgan Earnings Fuel Demand for Higher Yields
July 17 (Bloomberg) -- The yen dropped against the dollar and the euro as better-than-expected earnings at JPMorgan Chase & Co. fueled investors' appetite for higher-yielding assets funded in Japan.
The yen fell 0.4 percent to 105.50 per dollar at 10:09 a.m. in New York, from 105.13 yesterday, when it weakened to 103.77, the lowest since May 27. It dropped 0.7 percent to 167.51 per euro, from 166.39 yesterday. The dollar decreased 0.4 percent to $1.5884 versus the euro, from $1.5827. It touched an all-time low of $1.6038 two days ago.
The Dollar Index on the ICE market, which tracks the greenback against the currencies of six U.S. trading partners, fell 0.3 percent to 71.875, from 72.064 yesterday, when it touched 71.508, the lowest level since April 23.
Housing Starts
Housing starts increased to a 1,066,000 annual pace last month, compared with a revised 977,000 in May, the Commerce Department reported today. The median forecast of 76 economists surveyed by Bloomberg News was for a drop to a 960,000 rate.
Federal Reserve Chairman Ben S. Bernanke told the House Financial Services Committee yesterday that growth and inflation risks are increasing and the housing market is the ``central element'' of the crisis.
The yen dropped 1.1 percent to 13.9677 against the South African rand while the Swiss franc dropped 0.5 percent to 5.8753 Swedish kronar as traders sold the currencies to buy higher- yielding assets such as stocks where returns are higher.
The Bank of Japan held its target lending rate at 0.5 percent this week, the lowest among major economies, while borrowing costs in Switzerland are 2.75 percent. In comparison, the benchmark rates are 12 percent in South Africa and 4.5 percent in Sweden.