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Tokyo - The yen lost its early gains on Tuesday after a short-lived rally driven by concerns over tumbling oil prices.
In afternoon trading, the dollar swung to ¥118.66, up from ¥118.27 in New York and ¥117.94 earlier on Tuesday in Tokyo, while the euro was also stronger at ¥140.33, from ¥139.98 in US trade.
"There was no fresh news or data behind the moves," said Daisuke Karakama, a forex trader at Mizuho Bank.
In morning deals, traders bought the yen as tumbling oil prices sent investors scurrying for safer investments. The yen is seen as a stable bet in times of turmoil and uncertainty.
The euro, meanwhile, fetched $1.1826, edging lower from $1.1834 in New York as investors gauge whether the European Central Bank (ECB) will soon expand its stimulus, while the US Federal Reserve eyes a mid-year interest rate hike.
"Everyone feels that a weaker oil price will lead to weaker inflation for the US," Stan Shamu, a Melbourne-based market strategist at IG, told Bloomberg News.
"This will see them (the Fed) delay their rates lift off. That will probably see a bit of steam coming out of the US dollar."
On Monday, crude sank again after Goldman Sachs slashed its price outlook for the commodity, adding to anxiety about a global oversupply, weak demand and soft growth in key Chinese and European markets.
In early Asian trade Tuesday, Brent crude for February delivery fell 75 cents to $46.68 a barrel - its lowest level April 2009. On Monday it plunged more than five percent to end below $50.
US benchmark West Texas Intermediate shed 73c to $45.34 - its weakest since March 2009 - a day after losing 4.7%.
Investors were also looking ahead to the ECB's meeting on January 22 for some clues on its intention to launch a quantitative easing (QE) programme that would see it buy government bonds - similar to the US Federal Reserve during the global financial crisis - to fend off deflation in the eurozone.
The dollar was mixed against other Asia-Pacific currencies.
It weakened to 62.11 Indian rupees from 62.17 rupees on Monday, to 44.81 Philippine pesos from 44.86 pesos, and to Tw$31.82 from Tw$31.84.
The US unit rose to 12 611 Indonesian rupiah from 12 540 rupiah, to Sg$1.3352 from Sg$1.3315, and to 32.86 Thai baht from 32.83 baht.
The Australian dollar fell to 81.69 USc from 82.47c while the Chinese yuan was at ¥19.07 against ¥19.06.
