TOKYO: The dollar fell against the yen and euro in Asian trade Tuesday after weaker-than-expected US manufacturing data sparked renewed fears about the state of the world's biggest economy.
Worries over bailed-out Cyprus and a political stalemate in Italy also pressured the euro as currency markets look to a trio of central bank meetings this week.
In Tokyo morning trade the dollar bought 93.02 yen, down from 93.27 yen in New York on Monday.
The euro also weakened to 119.69 yen from 119.82 yen while it rose to $1.2867 from $1.2847.
On Monday the Institute for Supply Management said its closely watched US manufacturing index fell to 51.3 in March from 54.2 in February, reflecting growth for the fourth straight month but at a slower pace and stoking renewed fears about the economy's recovery.
Investors are keeping a close eye on policy meetings from the Bank of Japan (BoJ), the European Central Bank (ECB) and Bank of England this week.
The BoJ's two-day meeting, which starts Wednesday, comes after a bank survey Monday showed a modest uptick in confidence among large Japanese manufacturers, although it came in below expectations.
Analysts have tipped the BoJ to launch aggressive policy measures at its first meeting under a new governor, who vowed Tuesday "bold" monetary easing.
However, Haruhiko Kuroda's comments failed to push down the yen "amid a growing view that the BoJ will struggle to meet expectations already priced into currency markets", National Australia Bank said in a note.
A political stalemate in Italy following inconclusive elections and wider worries about the eurozone "remain troubling", the bank added.
"To top things off, geopolitical tensions have risen further, with North Korea passing a measure aimed at giving nuclear weapons greater prominence in defence and South Korea promising a strong response."
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