By KOSAKU NARIOKA TOKYO--The dollar and the euro rose against the yen Tuesday in Asia after a senior International Monetary Fund official said that the fund is sympathetic to Japan's views on the need to intervene in the currency market under certain circumstances. "If market forces lead to disruptive flows, short-term smoothing is something that we would understand," David Lipton, the fund's First Deputy Managing Director, said in an interview with The Wall Street Journal. Mr. Lipton, who is in Japan on fact-finding mission, also said the fund sees the yen as "moderately overvalued." The comments from the IMF official came at a time when market participants saw the dollar's ground firming against the yen with bids placed below 79.20 yen from Japanese importers, said Michiyoshi Kato, senior vice president of forex sales at Mizuho Corporate Bank. Market conditions also helped boost the dollar versus the yen following the IMF official's comments. But the greenback will likely face resistance at Y79.70, and firmer resistance at Y80.00 with profit-taking offers lined up above that level, Tokyo dealers said. Ahead of the key Greek election Sunday, trading was otherwise subdued with participants watching other markets such as equities, Tokyo dealers said. They are also paying attention to any development related to European sovereign debt problems. "The biggest focus is June 17 (Greek elections)," Mr. Kato said. The dollar was at Y79.54 as of 0450 GMT from Y79.43 late Monday in New York, according to EBS. The euro was at Y99.40 from Y99.15 and was at $1.2499 from $1.2483. The dollar was at CHF0.9611 from CHF0.9620. The ICE Dollar Index, which tracks the U.S. dollar against a basket of currencies, was at 82.511 from 82.627. The U.K. pound was at $1.5497 from $1.5486. Write to Kosaku Narioka at kosaku.narioka@dowjones.com

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