The yen reached a historic low against the euro and remained close to a four-year low against the dollar on Friday due to expectations of low Japanese rates. Oil stayed near $61, which was a seven-week high. Germany's Ifo business sentiment survey for February showed a larger-than-anticipated decline, causing a slight decrease in the euro against the dollar and an increase in Bunds. However, it did not change the belief that euro zone interest rates would increase the following month. Japanese exporters benefited from the weak yen, boosting the Nikkei average to a seven-year closing high. European stocks were negatively impacted by weakness in banking stocks and concerns over Iran's nuclear program. The euro briefly reached a record high of 159.63 yen before dropping to around 159.25 yen. Traders predicted that the euro would soon surpass the 160-yen level. The dollar traded around 121.40 yen after peaking at 121.63 yen for the second consecutive day, nearing the highest level since December 2002. The recent increase of 25 basis points in Japanese interest rates to 0.5 percent, the highest in a decade, has not been effective in stopping the yen from depreciating against major currencies. This is because Japanese rates are still lower compared to other developed countries. Ronnie Steadman from Lloyds TSB Financial Markets stated that the rise in short-term rates in Japan will not deter Japanese investors, particularly households, from buying foreign bonds and stocks to seek better returns. Investors have taken large short positions against the yen in carry trades, where they borrow yen to invest in higher-yielding assets elsewhere. The New Zealand dollar, known for its high yield, reached a 14-month high against the yen. Bank of Japan Governor Toshihiko Fukui emphasized that rate hikes will occur gradually. Germany's Ifo research institute reported a decrease in the business climate index to 107.0 in February from 107.9 in the previous month. Analysts still anticipate a European Central Bank rate increase to 3.75 percent in March. The euro was trading slightly lower at $1.311 at 1015 GMT. Euro zone bonds rebounded and yields on the 10-year Bund dropped by 3.2 basis points to 4.066 percent following the Ifo reading. Oil prices rose above $61 per barrel to a seven-week high due to a sharp decline in US gasoline stocks and concerns over Iran's nuclear program. US crude climbed 45 cents to $61.40 a barrel. It reached $61.49 earlier, the highest level since January 2nd. Iran stated it would not show any weakness regarding its nuclear program, following the UN nuclear watchdog's announcement that Tehran had missed the deadline to suspend uranium enrichment. European shares slightly decreased in early trading due to concerns about Iran and weakness in banking stocks, despite positive results from industrial sectors and higher commodity prices. The FTSEurofirst 300 index of top European shares was down 0.16 percent at 1,537.54 points, with slight decreases in British and French indexes and minimal change in Germany's index. Japan's Nikkei rose 0.44 percent to a seven-year closing high, driven in part by gains in exporters like Canon Inc benefiting from the weak yen. The increase was balanced out by a decrease of up to 29 percent in Sanyo Electric Co. following news of a regulatory investigation and reports of unaccounted losses exceeding $1 billion. The MSCI All-Country World Index stood at 380.93, up by 0.05 percent.