Trade halted on Icelandic krona

Trade in the Icelandic krona was halted Thursday after the government took over the country’s largest lender, Kaupthing Bank, after it also took over two other Icelandic lenders earlier in the week.

Sedlabanki, Iceland’s central bank, also abandoned its currency’s peg to the euro after just one day while Fitch Ratings cut Iceland’s foreign and local-currency debt ratings and Moody’s Investors Service cut the government’s debt rating yesterday.

The krona last traded at kr340 to the euro.

Meanwhile, the Japanese yen reversed recent declines and strengthened versus the US dollar, the euro, the Australian dollar and the New Zealand dollar Thursday on investor interest in carry trades after several Western and Asian central banks cut interest rates in the past two days.

The yen traded at ¥100.68 to the greenback at midday in New York while it was at ¥137.3425 to the euro and traded at ¥70.5365 to the Australian dollar and at ¥62.1 to the New Zealand dollar.

The Aussie and the kiwi, meanwhile, also gained on the US dollar, with the Aussie especially helped by gains in employment levels in Australia.

It took 70.06 cents US to buy a US dollar while the New Zealand dollar cost 61.70 cents US.

The Brazilian real was helped by the interest rate cuts over the past two days to trade higher at R$2.2090 to the greenback after the government there eased of rules on reserve requirements for banks and after Brazil’s central bank sold the US dollar for the first time in five years.

The South African rand also gained on the US dollar after its central bank held interest rates steady at 12 percent, with the rand lately trading at R9.0455 to the US currency.

On the other hand, the Canadian dollar weakened versus its US counterpart as the price of oil continued to decline, with the loonie trading at C$1.1470 to the US dollar in midday trade.

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