Yen Holds Gains After Joint Intervention, Dollar Sees Losses

The yen held onto most of its gains after last week's joint intervention by Tokyo and Washington to support the currency, but it did give back some ground on Tuesday. The Japanese currency had surged as much as 5% over the last three trading sessions, with Japan confirming coordinated yen-buying intervention on Friday with the U.S. in a rare move.

Lee Hardman, senior currency analyst at MUFG, said that while joint intervention may help provide support for the yen in the near-term, it can only buy time and there needs to be a change in fundamentals as well to encourage a sustainable reversal of the yen weakening trend that has been in place over the last five years.

The U.S. Treasury bought yen for euros instead of selling dollars last week, a highly unusual move likely aimed at helping Japan strengthen the yen without encouraging a view that Washington wants a softer dollar. Against the euro, the yen slipped 0.5% to 181.62, down from Monday's almost nine-month high of 179.44.

The dollar was nursing losses on Tuesday, having slid in the wake of the yen-buying intervention and on the back of falling oil prices. U.S. President Donald Trump said that talks with Iran were under way, warning that it was a 'last chance' for Tehran to sign a good deal to end the five-month-old war.