Dollar gains as investors move back into stocks, oil 

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The yen was lower against its rival currencies in Asian trade Tuesday, with improved market sentiment prompting sales of the safe-haven Japanese currency.

The U.S. dollar USDJPY, +0.47%  advanced to as high as ¥109.23 before trimming its gains to ¥109.06. That compared with ¥108.78 late Monday in New York.

A turnaround in the market’s mood, on a recovery in eurozone and U.S. stocks as well as a rebound in oil prices, prompted investors to sell the Japanese currency, considered as a safe harbor in troubled times.

Before the Tokyo stock market’s opening bell, investors were selling the yen anticipating a big gain for the Nikkei Stock Average NIK, +3.68% The benchmark index rose 3.7%, on track to end higher after two-session losing streak.

But the dollar then struggled to rise further after surpassing the ¥109-threshold earlier in the session.

“We are seeing (the dollar’s) upside is weighed down, as investors lock in profits or sell on recovery,” said Yuzo Sakai, manager of FX business promotion at Tokyo Forex & Ueda Harlow. “That’s capping the dollar’s upside, despite the stock market’s steep gain,” he said.

Investors had little reaction to Japanese Fiance Minister Taro Aso’s latest jawboning on the yen’s rapid rise.

“I’ve said this again and again, but basically it isn’t desirable for exchange rates to make rapid fluctuations,” said Aso, adding that “we will take various measures if there are what we see as sharp rises or sharp falls in the yen.”

The yen was also weaker against the euro EURJPY, +0.67%  , with the common currency gaining to ¥123.51 from ¥122.74 late Monday. The U.K. poundGBPJPY, +0.77%  rose to ¥156.13 from ¥155.36.

The Australian dollar AUDJPY, +0.66%   increased to ¥84.97 from ¥84.32.

Among other currency pairs, the euro EURUSD, +0.1856%   was at $1.1324 from $1.1281.

The WSJ Dollar Index BUXX, -0.10%  , a measure of the dollar against a basket of major currencies, was down 0.05% at 85.97.

Source: MarketWatch

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