Tokyo - The yen fell in Asia on Friday
ahead of weekend elections expected to see a change of leadership, while a key
Bank of Japan survey fuelled speculation of more central bank easing.
The dollar fetched ¥83.87 in Tokyo
afternoon trade from ¥83.64 in New York on Thursday afternoon.
The euro was at ¥109.74 from ¥109.38,
while rising to $1.3081 against $1.3073. Japan's currency has come under
pressure leading up to the December 16 polls, which are widely expected to see
the ruling Democratic Party of Japan ousted by Shinzo Abe and his opposition
Liberal Democratic Party.
Abe has repeatedly pledged to pressure
Japan's central bank into launching more aggressive easing measures to
kickstart the world's third-largest economy.
His successful re-election would boost the
chances of Tokyo appointing a like-minded head of the central bank when current
governor Masaaki Shirakawa's term ends next year, dealers say.
The forex market's focus was
"completely on" Japan's election and the BoJ meeting, said a senior
dealer at a major bank in Tokyo.
The BoJ's Tankan quarterly survey on Friday
showed confidence among large manufacturers, including automakers and
technology firms, plunged to the lowest level in almost three years during the
final months of 2012.
The survey - which comes just days after
official data showed the economy contracted in the third quarter and may have
slipped into recession - was sure to heap pressure on the BoJ for a stepped-up
economic offensive as it heads into a policy meeting next week, dealers said.
Currency markets were also keeping a close
eye on talks in Washington on averting the fiscal cliff as concerns grow that
divided US lawmakers will not clinch a new spending deal.
Supporting the euro, European finance ministers
agreed on Thursday to release a €34.3bn installment of
aid to debt-stricken Greece, averting a default.
The dollar was mixed against other