TOKYO — The greenback extended its gains in Asia on Tuesday, recovering from a sharp fall last week fuelled by Washington’s announcement that it had authorized airstrikes in Iraq. The dollar strengthened to 102.29 yen in afternoon Tokyo trade, against 102.21 yen in New York.
The euro was quoted at US$1.3375 and 136.81 yen, from US$1.3383 and 136.79 yen in New York as concerns persisted over a possible Russian military incursion into eastern Ukraine.
“As the geopolitical factors have been factored in, the market continues to see a retreat in risk-off moves, which supported dollar-buying sentiment against the yen,” said Yasuaki Amatatsu, analyst at the Bank of Tokyo-Mitsubishi UFJ. “The prospect for a steady recovery of the U.S. economy is also behind the dollar-buying sentiment.” Investors tend to buy the yen in times of uncertainty and turmoil. The dollar rallied Monday after plunging last week on U.S. President Barack Obama’s announcement that he had authorized airstrikes on Iraq along with humanitarian supply drops to prevent a “genocide” by Islamists. Dealers are now moving their focus to an annual economics conference in the United States later this month to be attended by Federal Reserve Chair Janet Yellen. The U.S. dollar was mixed against other Asia-Pacific currencies. It rose to SG$1.2503 from SG$1.2493 on Tuesday, to 11,681.30 Indonesian rupiah from 11,667.50 rupiah, to 61.12 Indian rupees from 61.09 rupees. The U.S. dollar weakened to 32.08 Thai baht from 32.12 baht, to 1,027.15 South Korean won from 1,035.35 won and to 43.86 Philippine pesos from 43.91 pesos. The Australian dollar slipped to 92.61 U.S. cents from 92.82 cents, while the Chinese yuan was higher at 16.61 yen against 16.59 yen.