Yen climbs on unwinding 'carry trade'

NEW YORK (AFP) — The yen extended its gains Monday amid another day of global financial market turbulence, with traders rushing to get out of "carry trade" investments funded by cheap Japanese credit.

The dollar slipped to 115.56 yen from 116.79 late Friday in New York, with the Japanese currency up some five percent since a week ago. The dollar at one point hit its lowest level since December 8.

The euro meanwhile fell to 1.3088 dollars from 1.3191 dollars on Friday.

Investors have been paring back their carry trades -- where money is borrowed in countries with low interest rates like Japan to be invested in higher-yielding economies -- as these prove less profitable when risk levels rise in global financial markets.

This is the case again this week with prices in stocks and commodities continuing to fall. This has meant investors have been scrambling to ...