Yen Slips After Surge, All Eyes on Central Banks

The yen weakened after reaching a 12-week peak against the dollar, influenced by a recovery in equity markets. Traders are now focused on central bank decisions in Japan and the U.S. The dollar and other major currencies also experienced movements, reflecting the broader market dynamics.

The yen weakened on Monday after soaring to a 12-week high against the dollar last week, as a recovery in equity markets reduced demand for the currency as a safe haven.

Market analysts suggest that a flush out of long-held short yen positions had largely run its course by the end of last week. Traders are now keenly anticipating central bank decisions in Japan and the U.S. on Wednesday for further guidance. Meanwhile, the British pound remained steady near a 2-1/2-week low against the euro ahead of the Bank of England's policy announcement on Thursday.

Early in the Asian trading day, the dollar improved by 0.29% to 154.24 yen, after reaching a low of 151.945 on Thursday for the first time since May 3. Last week, the dollar plummeted 2.36% against the yen, marking its worst weekly performance since late April.

(With inputs from agencies.)