Yen, Swiss franc see gains

The yen and the Swiss franc both strengthened Monday after Lehman Brothers (NYSE: LEH) was forced to declare bankruptcy after takeover talks failed and the US government wouldn’t step in to help, sending investors away from risky investments in higher-yielding currencies, while the also benefited from US insurer American International Group’s lack of success in seeking more capital that would allow it to keep its credit rating.

In mid-morning trade in New York, the yen was at ¥105.8850 to the greenback while it traded at ¥150.2190 to the euro, at ¥85.5338 to the Australian dollar and at ¥69.925 to the New Zealand currency.

Meanwhile, the Swiss franc gained to SFr1.1214 to the US dollar and to SFr1.5909 to the euro.

The US dollar weakened against some currencies on rising speculation that the Federal Reserve will cut interest rates again at its next meeting, but it gained a bit in relation to the euro after Bank of America (NYSE: BAC; TYO: 8648) agreed to take over Merrill Lynch (NYSE: MER; TYO: 8675), trading at $1.4152 to the shared currency at last report.

The Canadian dollar dropped in relation to the yen and the greenback, but it gained on currencies from other commodities exporters, such as the Norwegian krone.

The loonie traded at C$1.0727 to its US counterpart at mid-morning in New York and was at ¥98.7043 to the yen.

The Norwegian krone dropped to kr5.4152 to the Canadian dollar and traded down at kr8.1970 to the euro, but it strengthened to kr5.7272 to the US dollar.

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