NEW YORK — The dollar advanced against the yen as the Japanese currency continued to weaken on speculation that Japan's new government will seek to boost its economy by providing more stimulus.
The dollar rose to 93.70 against the yen, from 92.83 late on Friday. The U.S. currency is at its highest against the Japanese currency in almost three years. The yen has slumped almost 8 percent against the dollar this year after Japan elected Prime Minister Shinzo Abe in December. Abe is determined to overcome deflation in Japan.
The Japanese currency extended its decline against the dollar Monday after Asian Development Bank President Haruhiko Kuroda voiced support for Abe's financial policies. Kuroda, a former Japanese vice finance minister for international affairs, declined to comment on speculation that he may take over as Bank of Japan governor.
The euro edged higher to $1.3389 in Monday afternoon trading from $1.3363 late Friday. The currency strengthened after Jens Weidmann, the head of Germany's central bank, said the currency isn't seriously overvalued. Weidmann also said that a policy intended to weaken the euro would lead to higher inflation, Bloomberg News reported.
The European common currency fell against the dollar last week after Mario Draghi, the president of the European Central Bank said he would keep an eye on the strength of the currency and the impact that it was having on the region's economies.
The dollar rose against the British pound to $1.5660 from $1.5797. Against the Swiss franc, the dollar was little changed, trading at 0.9200, compared with 0.9172 per Swiss franc Friday. The Canadian dollar traded at parity with the U.S. dollar.