The yen made gains against the major currencies on Friday as investors took steps to reduce perceived risks following a decline in global stock markets.

Against the euro, the yen climbed to 160.67, although it had fallen back slightly to 161.65 in early London trading.

The Japanese currency also clawed back ground lost recently to the US dollar, rising to 118.51 per dollar from an opening position of 118.63.

Investors have reduced their use of the Japanese currency in the carry trades as election results prompted equity fears.

The coalition government was defeated in upper house elections last week and is embroiled in a pensions scandal.

"Investors are betting stock prices will fall due to the political uncertainty,'' currency dealer Kenichi Yumoto told Bloomberg.

Later this week, data from the US is expected to show a decline in consumer spending which may result in the Federal Reserve deciding to lower interest rates.