By Ruby Madren-Britton and Lukanyo Mnyanda Dec. 2 (Bloomberg) -- The yen fell against all of its major counterparts after Japanese Prime Minister Yukio Hatoyama was cited by the Nikkei newspaper as saying the currency’s strength can’t be left as it is. Japan’s currency headed for its first back-to-back drop in two weeks against the dollar following the Nikkei report. Chief Cabinet Secretary Hirofumi Hirano said later that Hatoyama wasn’t indicating the government is ready to intervene. The dollar traded at almost a 16-month low versus the euro on increased demand for riskier assets after a report showed U.S. companies cut the fewest jobs since July 2008 last month. “The yen is getting somewhat weaker on further signals that the Japanese authorities are getting concerned with the strength of their currency,” said Vassili Serebriakov, a currency strategist at Wells Fargo & Co. in New York. “Employment data will probably be more closely watched than other data going forward. Dollar weakness is still the main theme.” The yen weakened 0.6 percent to 87.17 per dollar at 8:33 a.m. in New York, from 86.68 yesterday. Japan’s currency declined 0.6 percent to 131.48 against the euro, from 130.74. The dollar was little changed at $1.5082 versus the euro, compared with $1.5081. It depreciated to $1.5144 on Nov. 25, the weakest level since August 2008. Rapid fluctuations in the currency market are undesirable, and the government is closely monitoring the situation, Hirano told reporters in Tokyo following Hatoyama’s comments. Intervention View Volatility may hamper growth, and the central bank is open to taking steps to support the economy, a Bank of Japan board member, Miyako Suda, said in a speech in Kofu, west of Tokyo. Central banks intervene by buying or selling currencies to influence exchange rates. The yen rallied 4.3 percent versus the dollar in November, helping to erode profits of exporters including Sony Corp. and Toyota Motor Corp. It reached a 14-year high of 84.83 against the U.S. currency on Nov. 27. The Australian dollar rose 0.9 percent to 80.88 yen and was up 0.3 percent against the dollar at 92.79 cents today. The New Zealand dollar gained 0.7 percent to 63.38 yen and strengthened 0.2 percent to 72.73 cents. Benchmark interest rates are 3.75 percent in Australia and 2.5 percent in New Zealand, compared with 0.1 percent in Japan and as low as zero in the U.S., attracting investors to the South Pacific nations’ higher-yielding assets. Company Job Cuts U.S. companies cut an estimated 169,000 jobs in November after a revised decrease of 195,000 in the previous month, ADP Employer Services reported today. The median forecast of 32 economists in a Bloomberg survey was for a reduction of 150,000. The Labor Department’s payrolls report is due on Dec. 4. “The global recovery is in motion,” said Adam Carr, senior economist at ICAP Australia Ltd. in Sydney. “A stronger employment report, of course, will lead to an increase in risk appetite, and we will probably see that weigh heavily on the U.S. dollar.” The so-called Aussie got a boost as gold, Australia’s third-most-valuable raw-material export, advanced to a record for a second straight day, reaching $1,217.23 an ounce. The euro rose against the yen as European finance leaders played down potential banking risks related to Dubai’s credit crisis. Dubai World, a government-related holding company, has begun talks with lenders to restructure $26 billion of debt. Outlook for Dubai The risk of losses for “European banks seems to be so far, from what we can assess, at a reasonable level,” Finance Minister Anders Borg of Sweden, which holds the rotating European Union presidency, said yesterday as he arrived for a meeting of finance chiefs in Brussels. There are “clear signs of a recovery,” Luxembourg’s Jean- Claude Juncker, who leads the group of euro-area finance ministers, said in a transcript of an interview posted on Luxembourg radio RTL’s Web site. Japan should ask the U.S. and Europe to take coordinated action to weaken the yen, Financial Services Minister Shizuka Kamei said in an interview in Tokyo today. “We need international coordination,” said Kamei, whose People’s New Party is a coalition partner to the Democratic Party of Japan. He has urged Finance Minister Hirohisa Fujii to seek international cooperation to halt the yen’s rally. The central bank said yesterday it will provide three-month loans to commercial banks at an interest rate of 0.1 percent as it seeks to address falling prices and a strengthening currency. The “money market operation was disappointing and will not be sufficient to change the dollar-yen trade,” analysts led by Hans-Guenter Redeker at BNP Paribas SA in London wrote in a client note today. “The BOJ should convert to a more aggressive style of quantitative easing.” To contact the reporters on this story: Ruby Madren-Britton in New York at rmadrenbritt@bloomberg.net; Lukanyo Mnyanda in London at lmnyanda@bloomberg.net

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