TOKYO: The dollar turned higher against the yen in Asia on Tuesday as investors waited for testimony by the US central bank chief and the outcome of a policy meeting of the Japanese central bank.
The dollar was changing hands at 102.52 yen in Tokyo afternoon trade, up from 102.26 yen in New York late Monday.
The euro rose to 132.11 yen from 131.76 yen in New York while edging upward to $1.2886 from $1.2884.
The dollar had weakened in early trade but rebounded after investors confirmed a good amount of dollar buying orders from Japanese traders, said a senior dealer at a major bank in Tokyo.
"The downside seems firm so we're reversing the course," the dealer said.
As the dollar bounced back, Tokyo share prices narrowed early losses to around the break-even point.
A strong yen is bad for Japanese exporters as it makes their products less competitive abroad and reduces income when repatriated. On the other hand a weak yen increases import costs, squeezing pockets and ramping up fuel prices in the resource-poor country.
Investors were now waiting for testimony by Federal Reserve chairman Ben Bernanke on Wednesday to learn his thoughts on the US economy and get an indication of how soon the bank might wrap up its easy money policies.
The Bank of Japan is due to reveal the outcome of a two-day policy meeting Wednesday. Few expect the bank to take fresh measures after its massive monetary easing in early April drove the yen down to multi-year lows against the dollar.
Economy minister Akira Amari said on Tuesday he hoped "the market will find a point where the effects (of the currency level) on imports and exports achieves a balance".
Amari said on Sunday that the yen's excessive strength had mostly been "corrected", prompting buying of the Japanese currency on Monday.
The dollar was largely lower against other Asia-Pacific currencies.
It fell to Sg$1.2546 Tuesday afternoon from Sg$1.2551 Monday afternoon, to 9,760 Indonesian rupiah from 9,770 rupiah and to 1,111.48 South Korean won from 1,117.15 won.
The US unit also declined to 29.72 Thai baht from 29.87 baht, to Tw$29.72 from Tw$29.96 and to 41.13 Philippine pesos 41.21 pesos but rose to 55.08 Indian rupees from 55.01 rupees.
The Australian dollar firmed to 98.10 US cents from 97.76 cents while the Chinese yuan changed hands at 16.72 yen against 16.69 yen.
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