The euro eased in morning Asian trade on Tuesday after hitting a six-week high in New York as Greece launched its bid to buy back privately held debt at a big discount, a key part of Athens' bailout plan.
The single currency bought $1.3048 and 107.13 yen in Tokyo, from $1.3051 and 107.36 yen in New York late Monday where it had soared at one stage to $1.3076, its highest level since October 22.
The dollar weakened against the Japanese currency, dipping to 82.10 yen from 82.24 yen on the back of poor US manufacturing data.
On Monday in New York the euro was buoyed as Greece launched the debt buyback programme, an underlying condition for Athens to receive a crucial 43.7-billion-euro installment of bailout funds from the European Union and International Monetary Fund.
Aimed at slashing the country's crushing debt load, the buyback is only one of a string of measures agreed last month.
Separately, preparations for Spain to recapitalise its banks using about 39.5 billion euros in loans were waved through at Eurogroup talks in Brussels, as expected.
The dollar was weighed as talks remain gridlocked on averting the US fiscal cliff, while the Institute for Supply Management said its closely-watched index on manufacturing activity for November fell into contraction after two months of expansion.
Businesses surveyed by the ISM blamed the slowing global economy and uncertainty from the talks in Washington, where politicians have dug in their heels instead of compromising on a plan that would avoid the drastic fiscal measures.
If the tax hikes and spending cuts come into effect on January 1 without a deal the economy will likely tip into recession.