Yen shores up

Hot Now

TOKYO: The yen held on to gains on Tuesday, shored up by investors' risk aversion and receding expectations that Japan will weaken the currency after a fresh warning by the United States last week against intervention.

Commodity-linked currencies such as the Australian and Canadian dollars were on the back foot, weighed down by a continuing decline in commodities such as crude oil.The euro was flat at 122.605 yen after sliding 0.8 percent overnight.  The dollar was firm at 109.260 yen, having fallen to as low as 109.120 overnight.  The greenback had risen to a three-week high of 110.590 late last week as prospects of the Federal Reserve hiking interest rates as early as June were revived.

But the dollar has given back a large part of its gains to the yen after a weekend G7 meeting of central bankers and finance ministers concluded with the United States warning Japan against intervening to weaken the yen, a rift that is perceived as preventing Tokyo from acting.  A decline in global equities at the start of the week has given the safe-haven yen an added lift.

Hawkish comments from Fed officials overnight like St. Louis Fed President James Bullard and San Francisco Fed President John Williams have done little to support the dollar against its Japanese counterpart.