TOKYO: The dollar edged up against the yen in Asia Thursday after falling in US trade on concerns about the US banking system and tensions between Russia and the West.
The dollar was at 102.15 yen in Tokyo early afternoon trade, slightly up from 102.00 yen in New York Wednesday afternoon.
The euro, which fell Wednesday on hints from the European Central Bank that it will act to fight deflationary pressures, bought $1.3783 and 140.78 yen compared with $1.3788 and 140.57 yen in US trade.
On Wednesday the US Federal Reserve rejected capital plans from five large banks as part of its annual "stress test" of firms' ability to withstand a severe economic downturn, said a senior bank dealer in Tokyo.
The central bank said four of the five -- Citi, HSBC North America, RBS Citizens Financial and Santander Holdings USA -- had "qualitative" shortfalls in their capital foundations. The fifth, Zions Bancorporation, failed because its basic capital ratio was too low.
"The dollar came under pressure... after the Fed move helped US stocks and bond yields fall," said Mitsui UFJ Trust and Banking senior dealer Toshihiko Sakai said.
But the rejection was "far from plunging financial markets into a risk-off mode", he said. "It is also difficult to build large positions in the final days of the fiscal year."
Exporters were offloading their dollar holdings as Thursday is the last day of spot trading on which transactions will be settled within the current fiscal year that ends on March 31.
Also playing on investors' nerves is the ongoing stand-off between the West and Russia following Moscow's takeover of Crimea from Ukraine this month.
US Defence Secretary Chuck Hagel said Russia had moved more troops closer to Ukraine's borders in recent days despite assurances it will not invade.
Markets remain wary as US President Barack Obama called for greater sanctions on Russia. Obama said Wednesday that the United States and its allies need to "step up" their commitments.
There are fears about the long-term ramifications of the stand-off, with Europe hugely reliant on Russia for its energy.
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