Dollar steadies

TOKYO: The dollar held steady at near 8-week highs versus the yen on Tuesday, with investors awaiting the Federal Reserve´s policy statement this week for fresh hints on the possible pace and timing of further U.S. monetary tightening.

The dollar last changed hands at 111.52 yen, trading within sight of Monday´s peak of 111.665 yen, its highest level since July 27.The greenback has benefited from a recent surge in U.S. bond yields.

The U.S. 10-year Treasury yield had reached a one-month high of 2.237 percent on Monday.

That marked a rise of 22 basis points from 10-month lows set on Sept. 8, when U.S. bond yields fell on risk aversion, partly stemming from concerns about U.S.-North Korea tensions. In Asian trade on Tuesday, the U.S. 10-year Treasury yield slipped 1 basis point on the day to 2.218 percent.

Investors are now preparing for potentially more hawkish statements from the Federal Reserve after its two-day policy meeting ends on Wednesday, especially after the Bank of England surprised investors last week with talk of a possible rate hike. The Fed is widely expected to announce this week that it will start paring its balance sheet, with the reductions seen likely to start this year.