2014.03.0607:55:47UTC+00Yen Declines to 1-Week Low on Trimmed Haven Demand Connected to Ukraine

The yen pulled back to a one-week low against the dollar on trimmed down demand for safer assets as Russian and U.S. diplomats met in Paris to address issues clouding the political problems in the Ukraine.

The dollar depreciated versus the majority of its 16 major counterparts after less-than-projected employment data added to concern the U.S economy has been slowed by extreme winter weather. The euro sagged down versus the dollar before the European Central Bank meets to review financial policy tomorrow. Canada's dollar rallied against the greenback after Bank of Canada Governor Stephen Poloz kept its standard interest rate unaltered and said the next move will be base on economic development.

“The yen acts as a funding currency when people want to take risks, and people are unwinding safe-haven flows,” Brad Bechtel, managing director at Faros Trading LLC in Stamford, Connecticut, said in a phone interview. “We’re definitely in a stalemate with the Ukraine situation, and markets are more than happy to continue to buy risk assets.”

The yen inched down 0.1 percent to 102.30 per dollar as of 5 p.m. in New York after dropping to 102.55, its weakest performing mark since February 26. It bolstered to 101.20 on March 3, the best performing mark since February 5. The yen was slightly moved at 140.49 per euro. Europe's shared currency plummeted 0.1 percent to $1.3733.

Real Advance

Brazil’s real bolstered against all 31 of its major counterparts as eased tension in Ukraine revived demand for emerging-market assets. The currency increased 1.1 percent to 2.3188 per dollar, after surging the most since February 27.

Canada’s dollar achieved the peak mark in two weeks after the Bank of Canada kept the overnight rate on loans between commercial banks at 1 percent for the 28th straight assembly. The currency depreciated to a 4 1/2 year low in January as investors bet on lower interest rates after the central bank said inflation would stay near the bottom of its 1 percent-to-3 percent target band this year and flagged the strong currency as a headwind to exports.

The loonie, as the currency is nicknamed, boosted 0.6 percent to C$1.1029 against the U.S. dollar.

The British pound marched higher against most of its major counterparts after an industry report showed U.K. services output expanded in February, adding to indications Britain’s economy is acquiring momentum. Sterling soared 0.4 percent to 82.13 pence per euro after skyrocketing 0.5 percent, the largest hike since February 12.

Employment Data

The U.S. currency weakened as firms raised 139,000 workers in February following a revised 127,000 hike in January that was weaker than primarily reported, according to the ADP Research Institute in Roseland, New Jersey. The median forecast of 39 economists surveyed by Bloomberg called for a 155,000 advance.

Labor Department figures on March 7 will display U.S. payrolls rallied 150,000 last month, according to a prediction of economists in a survey by Bloomberg. The U.S. recorded a 113,000 employment hike in January. The jobless rate is estimated to remain at 6.6 percent, the weakest point since October 2008.

The Institute for Supply Management’s non-manufacturing index moved down to 51.6, lower than any projection of economists surveyed by Bloomberg and the lowest since February 2010, the Tempe, Arizona-based group said today.

Investors are positive that “the payback resulting from the cold winter will produce a positive hiring rebound come the spring,” Andrew Wilkinson, the Greenwich, Connecticut-based chief market analyst at Interactive Brokers LLC, wrote in a client note. “Investors are likely to grit their teeth and cling to the weather-driven story.”