The U.S. dollar briefly weakened to the lower 159 yen range on Tuesday in Tokyo on persistent concerns over a possible yen-buying intervention by Japanese authorities aimed at arresting the yen's recent decline.
At 3 p.m., the dollar fetched 159.45-46 yen compared with 159.52-62 yen in New York and 159.68-70 yen in Tokyo at 5 p.m. Monday.
The yen remained weak against the euro after nearing a record low overnight in New York.
The euro was quoted at $1.0741-0742 and 171.27-29 yen against $1.0729-0739 and 171.28-38 yen in New York and $1.0712-0714 and 171.06-10 yen in Tokyo late Monday afternoon.
The dollar remained under pressure after climbing close to 160 yen the previous day, the level perceived as where Japanese authorities could step in, dealers said. They apparently conducted a yen-buying intervention after the dollar hit 160.24 yen on April 29.
"While it is seen as difficult for authorities to step into the market at the same 160 yen range as they did before, the current level was making investors wary," said Takuya Kanda, senior researcher at the Gaitame.com Research Institute.
Conducting an intervention at the same level would give an impression that it is their "defense line," which could lead to volatility if the dollar crosses the threshold, Kanda said, adding it is more likely authorities would step in if the currency rose rapidly against the yen.
Tokyo stocks ended higher, led by gains in auto and other export-related issues on the yen's recent weak tone. Bank shares also climbed on hopes of improved profits on the back of rising Japanese long-term interest rates.
The 225-issue Nikkei Stock Average ended up 368.50 points, or 0.95 percent, from Monday at 39,173.15. The broader Topix index finished 47.18 points, or 1.72 percent, higher at 2,787.37.
