Cook 'backs British entry'

By LACHLAN COLQUHOUN
Updated:

 

The euro fell against the yen amid reports that Foreign Secretary Robin Cook is set to use a Tokyo speech to press the case for British adoption of the currency.

Japanese traders switched out of the euro and into yen in Tokyo trade, pushing the euro down to 115.91 yen against Friday's Japanese close of 117.63.

Caught in the yen-dollar movements, the euro eased slightly to $1.0584 in Tokyo, although the trend was clouded by rumours of intervention by Japanese authorities, who are expected to sell yen in an effort to limit its strength.

Dealers attributed the euro's fall partly to fallout from German state election results over the weekend. Chancellor Gerhard Schröder's Social Democratic Party was rejected by voters in Brandenburg and Saarland. Others said the yen was being supported ahead of second-quarter Japanese GDP figures due on Thursday, which are expected to confirm the country's economic recovery.

Meanwhile, Cook is expected to tell his Japanese audience later today that the euro was already 'bringing new strength' to member countries.

Unsourced reports of his speech claim he will back British adoption of the euro 'subject to the support of the British people in a referendum'.

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