Yen seen extending its best two-week run since 1998

New York

WHEN the going gets tough, foreign-exchange traders turn to the yen.

Japan's currency may extend its biggest two-week rally since 1998 as investors continue to seek out refuge assets amid market turmoil, according Citigroup Inc.

State Street Global Advisors Inc, which oversees about US$2.4 trillion, says it's buying yen and selling dollars as the tumult gripping financial markets bolsters the Japanese currency's appeal.

"We're not counting on the market mood shifting any time soon," said Steven Englander, Citigroup's New York-based global head of Group-of-10 currency strategy. Citigroup, world's biggest foreign-exchange trader according to Euromoney magazine, expects haven currencies including the yen, euro and Swiss franc to appreciate in the near term, even though it said investors are being overly pessimistic about the p…