TOKYO- The dollar rose against the yen in Asia on Tuesday, with investor sentiment buoyed by another record close on Wall Street and soaring equities in Tokyo.
The greenback bought 104.34 yen in Tokyo afternoon trade from 104.11 yen in New York Monday afternoon.
The euro fetched 142.72 yen from 142.58 yen while buying $1.3678 against $1.3695.
Stocks jumped after the Dow and S&P 500 closed at all-time highs in New York in response to another set of upbeat consumer data indicating the US economy is getting back on track.
The rises spurred Japanese stocks to rally, with the buoyant sentiment helping to lift the dollar in thin trade ahead of the Christmas holiday season.
The yen usually rises in times of economic uncertainty as it is considered a safe haven but investors tend to abandon it when the outlook is rosy, instead buying up riskier assets such as stocks.
Tokyo’s benchmark Nikkei stock index was up 0.86 percent in mid-afternoon trade, above 16,000 for the fist time in six years.
“The yen is weakening in response to the strong Nikkei,” Daisaku Ueno, senior forex strategist at Mitsubishi UFJ Morgan Stanley, told Dow Jones Newswires.
The dollar also got support from the Federal Reserve’s decision to start rolling back its massive stimulus package in January.
Considering the Fed move and expectations that Japan’s easy money policy will continue for the time being, the dollar “will generally be in an upward trend, with occasional positions adjustments kicking in”, Ueno said.
Currency rates hardly moved after the Japanese government adopted a record $922 billion budget for the next fiscal year from April.
The greenback was mixed against other Asia-Pacific currencies.
It rose to Sg$1.2683 from Sg$1.2653 on Monday, to Tw$30.00 from Tw$29.95, to 1,060.45 South Korean won from 1,060.15 and to 32.76 Thai baht from 32.73 baht.
But it fell to 44.34 Philippine pesos from 44.41, to 12,225 Indonesian rupiah from 12,253 rupiah and to 61.85 Indian rupees from 61.95 rupees.
The Australian dollar edged down to 89.12 US cents from 89.45 cents. The Chinese yuan changed hands at 17.18 yen from 17.13 yen.