Investing.com - The yen traded weaker in Asia on Tuesday with investors at attention for any remarks on the currency by policymakers.
USD/JPY traded at 108.16, up 0.20%, while AUD/USD traded at 0.7618, up 0.30%.
Bank lending in Japan rose 2.0%, compared with a gain of 2.1% expected year-on-year for March.
In Australia, the NAB business confidence survey rose to plus-6 in March from plus-3 in the previous month, while the business survey jumped to plus-12 in March from plus-8. The rise in business conditions will be a significant input for the Reserve Bank's updated forecasts on the economy due in the quarterly Statement on Monetary Policy in May. The market is currently pricing in around a 40% chance of a 25 basis-point cut at the May meeting and this data are likely to lead to a retreat in pricing.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.03% at 94.00.
Overnight, the dollar dropped to eight-month lows against the other major currencies in subdued trade on Monday, as the Federal Reserve’s persistently cautious stance on rate hikes continued to weigh on the greenback.
Japan’s Chief Cabinet Secretary Yoshihide Suga said Monday the government was closely monitoring the foreign exchange market and added that the moves in the yen were one-sided and speculative.
But investors stuck to the view that Japan will refrain from any direct action to stem the yen’s gains until at least after this week's G20 meetings in Washington.
Separately, the dollar remained weaker against the yen on the view that the Federal Reserve will stick to a cautious approach on hiking interest rates this year amid concerns over the outlook for the global economy.
Lower interest rates make the dollar less attractive to yield seeking investors.