" The yen fell versus the euro and dollar after U.S. stock futures trimmed declines.
The Japanese currency earlier touched a three-month high versus the euro as investors cut riskier assets funded by loans in Japan, a practice known as the carry trade. At 0.5 percent, Japan has the lowest interest rate among industrialized nations. The yen rallied as the U.S. subprime debacle led traders to sell stocks and bonds in countries such as Turkey, Iceland and Brazil.
"I think the market is reassessing the contagion from the credit market,'' said Samarjit Shankar, director of global strategy for the foreign exchange group in Boston at Bank of New York Mellon. "It isn't clear how bad the subprime problem is and its impact on other sectors. Some people are coming back to buy other currencies against the yen at cheaper levels. It doesn't mean the unwinding is over.'' "
Source: Yen Declines Versus Euro, Dollar as Stock Futures Pare Losses (http://www.bloomberg.com/apps/news?pid=20601068&sid=awRRvXXMdhPY&refer=economy)