The yen depreciated sharply vis--vis the U.S. dollar today as the greenback tested offers around the 104.45 level and was supported around the 102.25 level. The pair reached its highest level since 29 February as an appetite for risk returned to the market with both the yen and the Swiss franc on the defensive. The Japanese governments April economic assessment was unchanged overall but downgraded its view on Japanese business conditions and the U.S. economy and noted Japans economic recovery appears to be pausing recently. Bank of Japan Governor Shirakawa indicated elevated energy and materials prices are reducing corporate profits. The BoJ is expected to keep the overnight call rate unchanged at 0.50% for the foreseeable future. Data released in Japan overnight saw March department store sales off 1.2% y/y while the March consumer confidence index rose to 36.7 from 36.1 in February. The Nikkei 225 stock index climbed 0.58% to close at 13,476.45. Dollar offers are cited around the 105.55 level. The euro moved higher vis--vis the yen as the single currency tested offers around the 164.40 level and was supported around the 162.65 level. The British pound moved higher vis--vis the yen as sterling tested offers around the 208.30 level while the Swiss franc moved lower vis--vis the yen and tested bids around the 101.25 level. The Chinese yuan appreciated vis--vis the U.S. dollar as the greenback closed at CNY 6.9935 in the over-the-counter market, down from CNY 6.9938. Data released in China today saw March property prices in 70 major cities up 10.7% y/y.