SymbolPriceChangeCRZBF.PK2.90-0.10MCO29.15-2.52{“s” : “CRZBF.PK,MCO”,”k” : “a00,a50,b00,b60,c10,g00,h00,l10,p20,t10,v00″,”o” : “”,”j” : “”}

* Japan (NYSE: MCO – news) sold 1 trillion yen to weaken currency

* Analysts expect safe-haven yen, franc to remain strong

* ECB says would buy Portuguese, Irish bonds
(Updates prices, adds quotes, changes byline)

NEW YORK (Xetra: A0DKRK – news) , Aug 4 (Reuters) – The yen fell sharply on
Thursday after Japan intervened to curb its strength to support
the country’s export-led economy, but analysts did not expect
any lasting impact given concerns about the global economy.

Official yen-selling pushed the dollar roughly 4 percent
higher to 80.25 yen on trading platform EBS, well off a low of
76.29 set on Monday. On Wednesday, the Swiss National Bank had
unexpectedly cut interest rates to cap a soaring Swiss franc.

The Japanese currency trimmed losses during New York
trading, however, while the franc gained broadly as investors’
strong demand for safe-haven assets persisted on fears a
recovery in the global economy is losing momentum.

“The fact that our equity, bond and FX indicators reveal a
good number of real-money investors are seeking safety in
respective asset markets and it’s not just speculative activity
driving the Swiss franc and yen higher suggests risk appetite
is firmly on the back foot,” said Samarjit Shankar, managing
director of global FX strategy at BNY Mellon in Boston.

The dollar last traded at 78.83 yen , up 2.3 percent
on the day. The euro gained 1 percent to 111.43 yen .

Japan sold one trillion yen ($12.6 billion). Finance
Minister Yoshihiko Noda said Japan had consulted its
international partners but acted on its own. The intervention
in Asia and London pushed the yen to a three-week low against
the dollar. For more see [ID:nL3E7J409F].

To support those efforts to weaken the yen, the Bank of
Japan eased monetary policy by boosting asset purchases.

Japan’s yen selling was its first since March 18 when the
Bank of Japan and other major central banks jointly intervened
after the yen surged to a record high versus the greenback.

Commerzbank (Other OTC: CRZBF.PK – news) analyst Lutz Karpowitz said, however, that
efforts by both Japan and Switzerland to weaken their
currencies were unlikely to spark a trend reversal.

“There are hardly any alternatives for investors looking
for a safe haven within the G10 universe,” Karpowitz wrote in a
note. “This fact is likely to prevent a stronger upward
correction in dollar/yen. In the end we are therefore likely to
see a sideways move.”

Japan tries to tame yen: [ID:nL3E7J409F]

Timeline on yen intervention: [ID:nL3E7J20DQ]

Japan faces uphill battle on yen: [ID:nL3E7J408Y]

Past Japan FX intervention: http://link.reuters.com/tyf82s

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

The euro was last down 1.3 percent at $1.4137 ,
having hit a two-week low of $1.4111 on EBS.

Traders noted more automatic sell orders under the $1.4100
area, with a break likely opening the way for a move lower to
around $1.4068, the July 19 low.

The European Central Bank resumed buying government bonds
after a four-month break and offered a new round of funding to
commercial banks in response to a worsening euro zone debt
crisis.

The ECB said after leaving interest rates unchanged at 1.5
percent that it would broaden its liquidity operations as it
revived its bond buying program in the secondary market by
buying Portuguese and Irish bonds.

But the Italian government bond yield premium over Bunds
rose to euro era peaks as the ECB had no immediate plans for
buying Italian and Spanish bonds. [ID:nL6E7J42I6]

“The main takeaway from today’s announcement is the limited
prospects for further ECB tightening, which should weigh on the
euro,” said Vassili Serebriakov, currency strategist at Wells
Fargo in New York.
(Additional reporting by Julie Haviv; Editing by James
Dalgleish)