Swiss Franc, Yen Advance on Drop in Asian Shares, Mortgage Lawsuit Report
The Swiss franc and yen strengthened as a decline in Asian stocks and a report that the U.S. will sue banks over mortgage-backed securities boosted demand for refuge currencies. The franc gained against all its major counterparts after the New York Times said the U.S. may sue companies including Bank of America Corp. for misrepresenting the quality of securities backed by home loans, citing three people briefed on the matter. The euro was set for its biggest weekly drop against the dollar in almost two months before a German report next week that economists say will show factory orders fell for the first time since March. The franc and yen tend to strengthen during periods of financial turmoil because their export-reliant economies don’t need foreign capital to balance current accounts. Payrolls in the U.S. rose by 68,000 jobs in August, down from a 117,000 increase in July, according to economist estimates before Labor Department data today.
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