The yen rose in Asia on Tuesday after Japan's finance minister moved to reassure the central bank's independence, while also saying there were no plans to buy foreign bonds to drive up inflation.
The dollar slipped to 93.67 yen in Tokyo afternoon trade from 93.95 yen in London on Monday, while the euro was weaker at 125.02 yen and $1.3348 against 125.43 yen and $1.3353. US markets were closed Monday for a national holiday.
Finance chief Taro Aso told a press briefing Tuesday morning that Tokyo had "no intention" of asking the Bank of Japan to buy foreign bonds as part of its monetary easing policy.
Such purchases could push the yen down, as the bank sells the currency to buy foreign bonds, and draw more anger from some critics, particularly in Europe, who have accused Tokyo of manipulating the yen's recent steep decline.
Japanese officials have repeatedly fended off the criticism, which has seen Tokyo accused of risking setting off a global currency war in which rival nations drive down their currencies to gain a trade advantage.
Aso's comments -- which came a day after Prime Minister Shinzo Abe mentioned such a move -- were "the sensible thing to say considering international norms", said Daisuke Karakama, vice president of forex sales at Mizuho Corporate Bank.
Regarding the independence of the central bank Aso Tuesday said the new government was "not thinking about a law change at the moment".
Abe had warned Monday he would "consider revising the BoJ law" if it could not deliver on its two percent inflation target outlined last month under political pressure.
The premier, who swept to power in landslide December elections, signalled he may rein in the Bank of Japan's independence if it fails to fall into line with his government's demands to boost the economy.
Abe was not specific about the possible legislative changes, but he has previously mused about reeling in the BoJ, drawing global criticism.
The gain in the yen reversed Monday's losses fuelled by news Japan had avoided being labelled a currency manipulator in a statement from the Group of 20 leading economies at a weekend meeting.
"The statement pledged not to 'target our exchange rates for competitive purposes', taken as a green light for more QE (quantitative easing) in Japan and a weaker yen," National Australia Bank said in a note.
The dollar was mixed against other Asia-Pacific currencies, falling to Tw$29.57 from Tw$29.65 Monday, to 40.62 Philippine pesos from 40.65 pesos, and to 54.20 Indian rupees from 54.33 rupees.
The greenback also fell to Sg$1.2380 from Sg$1.2394, and 1,080.55 South Korean won from 1,081.90 won.
The dollar rose to 9,707 Indonesian rupiah from 9,670 rupiah, while staying almost flat at 29.88 Thai baht.
The Australian dollar inched up to $1.0327 from $1.0295 while the Chinese yuan eased to 14.98 yen from 15.04 yen.
-- Dow Jones Newswires contributed to this article --