The yen slumped to fresh 39-month lows in Asia, follwing the meeting between US Treasury Secretary Paul O'Neill and Japanese Finance Minister Masajuro Shiokawa. Shiokawa said O'Neill told him forex rates are decided by markets, giving traders license to sell the yen as they saw no sign of US objections to a lower yen. Sterling was also sharply lower, following comments from John Townend, Director for Europe at the Bank of England, saying he thought that sterling was "clearly overvalued" vs. the euro.