Euro Rises as Asian Stock Gains Spur Demand for Higher Yields

By Yasuhiko Seki and Ron Harui

April 30 (Bloomberg) -- The euro advanced for a third day against the dollar and the yen on speculation gains in Asian stocks spurred demand for higher-yielding assets.

The euro also climbed versus 13 of the 16 most-active currencies on prospects the European Central Bank will refrain from lowering interest rates to zero and buying bonds. The dollar weakened after U.S. President Barack Obama said he is “hopeful” that Chrysler LLC will come up with a solution that will let a merger with Fiat SpA proceed and keep the U.S. automaker in business.

“Stock gains mean that investor appetite for risk taking is solid,” said Osamu Takashima, chief currency analyst in Tokyo at Bank of Tokyo-Mitsubishi UFJ Ltd., a unit of Japan’s largest banking group. “The yen is prone to selling.”

The euro climbed to $1.3311 as of 9:52 a.m. in Tokyo from $1.3271 in New York yesterday. The 16-nation currency advanced to 130.23 yen from 129.61, after touching 130.24, the highest since April 17. The yen traded at 97.84 versus the dollar from 97.66 yesterday.

Japan’s Nikkei 225 Stock Average advanced 3.9 percent and the MSCI Asia-Pacific Index of regional shares rose 1.9 percent.

To contact the reporters on this story: Yasuhiko Seki in Tokyo at yseki5@bloomberg.net; Ron Harui in Singapore at rharui@bloomberg.net.