The euro eased against other major currencies on Tuesday as risk aversion grew amid rekindled worries over the European debt crisis and weak Chinese manufacturing data.
The euro bought $1.3817 and 107.95 yen in Tokyo afternoon trade, down from $1.3851 and 108.34 yen in New York late Monday.
The dollar was at 78.11 yen, almost flat from New York. However it is down from its 79-plus yen level in Tokyo on Monday after Japan's first yen-selling intervention since August as its currency hit a record 75.32 against the greenback.
The European single unit fell with China's weak manufacturing data adding to the euro-negative factors, including the collapse of US brokerage MF Global, said dealers in Tokyo.
The firm filed for bankruptcy protection following a string of losses from European public debt holdings, the first US casualty of the eurozone crisis.
“Concerns about Europe's debt problems are not going away at all,” one dealer told Dow Jones Newswires.
Market jitters were further heightened after embattled Greek Prime Minister George Papandreou called a confidence vote and a referendum on last week's EU debt deal, taking a political gamble to silence growing opposition to his policies.
China's official purchasing managers' index (PMI) logged the first fall in three months in October, likely indicating manufacturing activity slowed as a result of Beijing's tightening measures and tepid global growth.
Japan on Monday intervened in currency markets for the first time since August and the third time this year to weaken the yen, after the unit's latest post-war dollar high underlined the threat to the export-led economy.
Tokyo has faced domestic pressure to act on the yen due to worries over its impact on the nation's economic recovery.
Finance Minister Jun Azumi said Tuesday that Tokyo was waging “a war of nerves” against speculators and would be keeping a close eye on market developments.
Barclays Capital chief strategist Masafumi Yamamoto said if Japan sticks to a recent intervention pattern of infrequent but large amounts, then authorities may not stage another intervention soon.
They could wait until at least after this week's meetings of the European Central Bank and US central bank's policy-making Federal Open Market Committee are over and key US jobs data are released on Friday, he said.
The dollar was mixed against Asian currencies.
The greenback rose to Sg$1.2617 from Sg$1.2508 on Monday, to 1,112.70 South Korean won from 1,107.80 and to Tw$30.03 from Tw$29.92.
It also gained to 30.80 Thai baht from 30.74, while falling to 8,825.00 Indonesian rupiah from 8,851.25 and to 42.61 Philippine pesos from 42.72. - Sapa-AFP