US shakes up currency markets with talk of unusual yen-buying via selling euros

LONDON, Aug 3 : Traders grappling with an already rare co-ordinated U.S.-Japanese action to prop up the weak yen are also digesting a further unusual dynamic: the U.S. selling euros. Japan confirmed on Monday it had carried out yen-buying intervention on Friday with the U.S. Treasury department. But rather than buying yen and selling dollars, the Financial Times reported the U.S. Treasury on Friday instead bought yen for euros. One broker source also told Reuters Treasury had intervened in euro/yen. Analysts at HSBC said this was "a highly unusual — maybe unprecedented — step". The move likely reflects a desire by U.S. authorities to help Japan strengthen the yen but not encourage a view that Washington wants a softer dollar — which would only complicate efforts to rein in above target inf