Shinzo Abe, on the brink of nominating a new governor for the Bank of Japan, stated that purchasing foreign bonds may be among several options for the central bank, whose policies contributed to factors behind the exchange rate.
His comments followed the Friday G20 nations meeting on the weekend which did not single out Japan as manipulating currencies in order to get a competitive edge.
The dollar increased 0.6% to 94.01 yen, recovering from the low of 92.20 on Friday and within reach of a 33-month peak around 94.47 set last week, although profit-taking by speculators stopped it from testing that level.
According to analysts, the downtrend of the yen was intact.
The euro rose 0.2% at 125.32 yen.
The senior currency strategist at Rabobank, Jane Foley, said that the G20 hasn’t made much of anything clear and the yen will continue to weaken from the Japanese government leaning on the Bank of Japan to be more accommodative.
She said that she expected the dollar to increase to 95 yen in the future. However, she believed that the pace would be gradual since it had already risen in a short time and may see some consolidation in the coming weeks.
According to data, speculators trimmed strong bets marginally on the Japanese yen weakening in the week which ended February 12. Citi added a current long dollar-yen spot position to their ideas portfolio.