The dollar strengthened against the yen and slipped slightly against the euro Wednesday in nervous trade as talks over how to avert the US 'fiscal cliff' dragged on.
The dollar rose against the yen, reaching 84.39 yen towards 2300 GMT, down slightly from 84.62 earlier in the day -- its highest level in 20 months. Late Tuesday, it finished at 84.19.
The euro stood at $1.3226 towards 2300 GMT, compared to $1.3225 late Tuesday. Earlier, it had reached its highest level in eight and a half months at $1.3308.
Boris Schlossberg of BK Asset Management said investors were disappointed by the lack of movement in protracted talks between US President Barack Obama and Republicans on a long-term deficit deal to avert the "fiscal cliff" crisis of sweeping tax hikes and spending cuts.
The euro was up against the Japanese currency at 111.59 yen, after reaching its highest level in 16 months -- 112.50 yen -- in earlier trade. Late Tuesday, it stood at 111.35 yen.
Japan's incoming prime minister Shinzo Abe, whose Liberal Democratic Party swept to an electoral victory in elections Sunday, has vowed to step up pressure on the central bank for more aggressive action to boost the economy.
The hawkish LDP head wants the bank to set a two percent inflation target as part of a goal to drag Japan out of the deflationary spiral that has haunted it for years.
In other currencies, the dollar rose to 0.9133 Swiss francs, while the pound slipped to $1.6245.