Dollar Holds Near Two-Month High as Asian Currencies Fluctuate

The dollar held near its two-month high on Tuesday, while Asian currencies were mixed. The Japanese yen weakened towards recent lows as markets remained alert to intervention risks and assessed the Bank of Japan's policy path.

Oil prices were volatile and Treasury yields rose sharply, supporting the dollar. However, gains were limited as investors waited for U.S. data later this week for clues on the Federal Reserve's rate path.

The Australian dollar awaited a widely expected interest rate hike from the RBA, which is seen raising its cash rate by 25 basis points to 4.60%. The central bank has struggled to recover due to much of the expected tightening being already priced in.