Pound weakens as yen gains strength

The pound weakened Friday on concerns that an argument between the UK and Iceland who is obligated to compensate UK account holders in Icelandic banks that were taken over by the government in Iceland this week when the banking system collapsed there.

At just after 1 p.m. in New York, the pound traded at 79.31p to the euro while it took $1.6975 to buy a pound.

The yen strengthened on more declines in equities markets that had investors fleeing carry trades that they had financed with the low-yielding yen.

In early afternoon trade in New York, the yen traded at ¥99.655 to the US dollar, which lost 5.2 percent to the Japanese currency this week, while it was at ¥134.1606 to the euro, at ¥65.0846 to the Australian dollar and at ¥59.271 to the New Zealand dollar.

Meanwhile, the euro weakened in relation to the greenback as the dollar traded at $1.3463 to the shared currency on the chance that the European Central Bank will lower interest rates again after this week’s cut, which was the first for the ECB in five years.

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