Yen takes a step back

Hot Now

SYDNEY: The yen showed signs of fatigue on Thursday after stepping back from recent peaks, while the greenback was supported by optimism the U.S. economy could bounce back after nearly stalling in the first quarter.

The dollar edged up 0.1 percent to 107.13 yen, pulling away from an 18-month trough of 105.55 set on Tuesday. The euro rose to 123.03 yen, off a three-year low of 121.665 plumbed last Friday.

Prime Minister Shinzo Abe on Wednesday warned Japan will act if necessary to weaken the yen, although many believe the bar is high for any market intervention.

The possibility of currency intervention by Japanese authorities would likely become much higher if the dollar were to fall to 100 yen, said Tan Teck Leng, FX strategist for UBS Wealth Management in Singapore.

In the past, Japanese officials had issued stronger verbal warnings on the yen's rise before intervening, Tan said.

"Ready to act and watching it closely is not yet the final warning," Tan added.

The Australian dollar edged up 0.5 percent to $0.7499, helped by upbeat Australian data, including a better-than-expected rise in retail sales in March.