Investing.com - The U.S. dollar hit two-week highs against the yen on Monday after a weekend summit meeting between U.S. President Donald Trump and Japanese Prime Minister Shinzo Abe went smoothly.
USD/JPY hit highs of 114.17, the most since January 30 and was last at 113.73, up 0.49% for the day.
In the meeting with Abe, Trump avoided repeating accusations that Japan was one of several countries devaluing their currencies to the disadvantage of the U.S.
Abe and Trump also agreed to hold an economic dialogue after Trump withdrew the U.S. from the Trans-Pacific Partnership agreement.
Market sentiment also received a boost after Trump agreed to honor the "one China" policy during a phone call with China's leader Xi Jinping late last week.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady 100.65, holding below the eleven-day highs of 101.02 set on Friday.
Demand for the dollar continued to be underpinned after remarks from Trump indicated that his administration would soon reform tax policy.
Trump said Thursday he would be announcing something over the next two or three weeks that would be “phenomenal” in terms of tax, without providing any additional details.
The euro was little changed against the dollar, with EUR/USD at 1.0642 as investors continued to watch events in Greece as efforts continued to reach a deal on its next bailout payment before February 20th.
The single currency also remained under pressure amid fears over the possibility of a Brexit or Trump-style shock result in France’s upcoming presidential election.
The European Commission on Monday upped its growth forecasts for the euro zone over the next two years, but warned that uncertainty about U.S. policies, Brexit and elections in Germany and France would take their toll on the economy.
Meanwhile, sterling pushed higher, with GBP/USD up 0.29% at 1.2524.