Investing.com - The dollar rebounded against the broadly weaker yen on Tuesday as expectations that the Federal Reserve will scale back its monetary easing program underpinned demand for the dollar.
During European morning trade, the dollar rallied against the yen, with USD/JPY jumping 1.19% to 102.14.
The yen weakened against the dollar and the euro on Tuesday as Japan’s Nikkei stabilized following extreme volatility in recent sessions.
Demand for the dollar continued to be supported by expectations that the U.S. central bank is moving closer to winding down its USD85 billion-a-month asset purchase program.
Fed Chairman Ben Bernanke said last week that a decision to scale back bond purchases could be taken in the "next few meetings" depending on economic data.
Elsewhere, the euro slipped lower against the dollar, with EUR/USD down 0.18% to 1.2906.
The dollar edged higher against the pound, with GBP/USD dipping 0.08% to 1.5091.
The dollar gained ground against the Swiss franc, with USD/CHF climbing 0.66% to 0.9694.
The greenback was mixed against its Australian, New Zealand and Canadian counterparts, with AUD/USD rising 0.38% to 0.9668, NZD/USD up 0.39% to 0.8112 and USD/CAD gaining 0.14% to trade at 1.0350.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.28% to 83.98.
Investors were looking ahead to U.S. private sector data on house price inflation and a report on consumer confidence later Tuesday.
