JPY gains accelerated in the European morning, with the market led by a broad reduction in risk. Failure to bail out Lehman Brothers weighed heavily on global equities, which fueled a move back in to JPY by funds exposed to overseas assets. Japanese real money selling was evident via the crosses and hedge funds also actively reduced exposure to leveraged positions. EURJPY selling led the European morning action, with the cross moving steadily lower from 151.90 at the European open and accelerating through 150.00, where a series of stops saw prices gap down to 149.56. USD-JPY broke the 105.00 handle and traded at 104.82 lows. GBPJPY, AUDJPY and NZDJPY fell in sympathy amid the broad based JPY adjustment, but the bulk of the flows went through EURJPY and the dollar legs, EURUSD and USDJPY. EURUSD extended its losses to hit 1.4267 intraday lows on the sell-off.
