US Dollar hit by Japan govt adviser's yen comment, drags index lower

Tokyo-Japan (Mar 3)  The dollar eased from an 11-year peak against a basket of currencies on Tuesday, hit by losses against the yen after an economic adviser to Japanese Prime Minister Shinzo Abe said the greenback could not sustain more gains.

Etsuro Honda, who some analysts described as a proponent of yen weakness, told the Wall Street Journal in an interview that dollar/yen may be at the ``upper limit of comfort zone''.

The comments pulled the dollar off a three-week high of 120.27 yen hit earlier due to a spike in U.S. debt yields. It last traded at 119.78, down 0.3 percent. The euro was lower at 134 yen.

"Honda's comments reflect the latest view of the government and comes ahead of a proposed visit by Abe to the United States in April,'' said Yujiro Goto, currency strategist at Nomura.

Source: CNBC