By Ben Rooney, staff reporterJanuary 22, 2010: 8:14 AM ET
NEW YORK (CNNMoney.com) -- The dollar fell against the Japanese yen Friday, but continued to strengthen versus the euro, as investors shied away from risk amid ongoing concerns about the global economy.
What prices are doing: The dollar was down 0.4% versus the yen to ¥90.05 and fell 0.5% against the U.K. pound to $1.6119. But the dollar rose 0.3% versus the euro to $1.4123.
What's moving the market: Traders turned to the dollar and the yen, both considered safe havens, as global stocks fell and U.S. markets were set to open lower.
Wall Street suffered its worst day in months Thursday following the Obama administration's proposal to increase regulation on the nation's biggest financial firms.
The selloff spread to overseas markets. Japan's Nikkei closed 2.5% lower and markets in Europe trading down about 1% in active trading.
But the euro received some support as rumors circulated that a positive announcement on Greece was due over the weekend, according to Boris Schlossberg, director of currency research at trading firm GFT.
"There were no details so far, but the head of Greek debt agency revealed that 5-10 year bonds will be sold in February through syndication, putting to rest the speculation that Greece will avoid public markets by doing a private placement," Schlossberg wrote in a research report.
Concerns about the Greek economy had weighed on the euro in recent sessions as traders worried that the country's debt woes could signal more economic pain in Europe.
Meanwhile, the market continues to grapple with signs that China's central bank could move to tighten monetary policy to help cool the country's robust economic growth.
What analysts are saying. "The threat of Chinese rate hike as early as this month remains the more immediate risk to global risk appetite," Ashraf Laidi, chief market strategist at CMC Markets in London, wrote in a note to clients.
Laidi said the stock market's reaction to Thursday's announcement concerning U.S. bank regulation may have been overdone. But he added that the proposed regulations could hurt U.S. banks' profitability and eventually weigh on the dollar.
"The story could become U.S. dollar-negative as long it remains a U.S.-specific issue," Laidi said.
