Investing.com - The yen drifted higher in Asia on Tuesday as investors increasingly expect a Fed rate hike in June in an otherwise ligt regionald ata day.
The latest signal came from who said Monday that two to three rate hikes are possible this year if the economy continues to grow as projected.
changed hands at 109.29, up 0.05%, while traded at 0.7222, down 0.03%.
The , which measures the greenback's strength against a trade-weighted basket of six major currencies, fell 0.06% to 95.23.
Overnight, the dollar held onto modest gains against the other major currencies trade in quiet trade on Monday, as expectations for June rate hike by the Federal Reserve continued to support demand for the greenback.
The yen was boosted after data on Monday showed that Japan's trade surplus for April came in at ¥823.5 billion, far above forecasts for ¥493 billion.
A separate report showed that Japanese factory activity contracted at the fastest pace in over three years in May as new orders fell.
The downbeat data added to pressure on the Bank of Japan to step up measures to spur growth.
The reports came after a meeting of the G7 ended on Saturday with the U.S. reiterating warnings to Tokyo against intervening to weaken the yen.
Meanwhile, the dollar remained supported after the Federal Reserve's April meeting minutes on Wednesday indicated that interest rates could rise as soon as June.
In a speech on Monday, San Francisco Fed President John Williams said he expects the U.S. central bank to increase rates two or three times this year, though he was concerned about the drop in inflation expectations.
The comments came after Boston Fed President Eric Rosengren said over the weekend that the U.S. was close to meeting most of the economic conditions necessary for the central bank to proceed with the tightening of monetary policy.
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