Global markets: Yen near fresh lows vs dollar, Asian shares steady
The yen hovered near fresh lows against the dollar and Japanese stocks jumped on Tuesday after a U.S. official voiced support for Japan's drive to beat deflation, assuaging fears that criticism of its aggressive stance on monetary policy would mount.
Asian shares were steady, with many regional bourses shut for holidays. Encouraging data from China late last week was lending support but markets lacked momentum as investors await key events such as the U.S. president's State of the Union address.
Rhetoric about a so-called currency war was dialed back ahead of a Group of 20 meeting. In addition to U.S. Treasury Undersecretary Lael Brainard saying the United States supports Japanese efforts to end deflation, European Central Bank council member Jens Weidmann said the euro was not overvalued at current levels.
On Monday, the yen sank to its lowest since May 2010 of 94.465 and also plunged over 2 percent against the euro as traders saw Brainard's remarks as an encouraging sign to sell the yen further.
In early Tuesday trade, the dollar was trading at 94.22 yen and the euro was at 126.35 yen. The euro scaled its highest since April 2010 of 127.71 yen last week.
Japan's Nikkei stock average opened 1.7 percent higher, after snapping a 12-week winning streak to close down 1.8 percent on Friday.
"While currency moves have been sensitive to officials' comments in general, people thought any comment from the G20 would trigger yen buying," said Hiroichi Nishi, an assistant general manager at SMBC Nikko Securities.
"But such worries are receding
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