The Japanese yen came under fresh selling pressure on Monday as G20 officials poured cold water on talk of "currency wars" and decided not to criticise Japan's recent policies to bolster its economy.

The dollar rallied to an intra-day high of ¥94.20 as the yen resumed recent weakness and later changed hands at ¥93.81 compared to a low of ¥92.20 on Friday.

The G20 pledged to move more rapidly toward more market-determined exchange rate systems and attempt to "avoid persistent exchange rate misalignments."

It also said it would avoid direct currency manipulation: "We will refrain from competitive devaluation. We will not target our exchange rates for competitive purposes, will resist all forms of protectionism and keep our markets open."

Otherwise trading volumes were thin on Monday with US markets closed for
President's Day.

The euro struck a high of ¥125.68 on Monday before later trading at ¥125.34 compared to ¥124.96 on Friday as traders mulled comments from European Central Bank president Mario Draghi about downside risks to Eurozone economy.

The single currency weakened 0.1% at $1.3348, after trading at $1.3333 following Draghi's comments.

However the euro's decline was limited, helped in most part by the yen's weakness.

The dollar index, which measures the US currency against a basket of six other currencies, advanced to 80.618 from 80.475 on Friday.

Sterling bought $1.5476 compared with $1.5513 on Friday after encouraging housing but gloomy January retail sales figures.



CJ

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