TOKYO (AP) -- The U.S. dollar lost some of its overnight New York gains against the Japanese yen in Asian trading Wednesday because of nagging concerns about the American economy and renewed hopes for a higher Chinese currency.
The U.S. dollar was trading at 103.47 yen on the Tokyo foreign exchange market by midafternoon, up 0.33 yen from late Tuesday but below the 104.23 yen it bought in late New York trading.
The euro was trading at US$1.2988 Wednesday afternoon in Tokyo, down from US$1.3057 late Tuesday. Against the Japanese currency, the euro also was lower at 134.44 yen from 134.60 yen.
The dollar fell against most regional currencies, inching down to 1,031.0 South Korean won from 1,031.5 the previous day, and to 31.820 Taiwan dollar from 31.845. It also dropped to 1.6360 Singapore dollar from 1.6409.
The dollar weakened in Tokyo on renewed speculation that global financial officials may start putting pressure on China for its currency -- which is now pegged to the dollar -- to rise.
Such expectations have come and gone in recent weeks.
The dollar's decline follows its gains overnight following the release of figures showing American consumer confidence rising for the second consecutive month in January.
Players, however, say the dollar is unlikely to rise too much above 104 yen because of downward pressures caused by worries about the massive U.S. trade and budget deficits.
In recent weeks, the dollar has recovered some of its losses from last year as hopes fade for policy changes on the value of Asian currencies.
Many analysts feel that the Chinese yuan and other Asian currencies are too low against the dollar and are expecting policy changes that will push the dollar down against those currencies.
Speculation is rife that the currency issue will be taken up at least on the sidelines of the Feb. 4-5 London meeting of Group of Seven finance ministers and central bank chiefs.
Expectations about Chinese currency revaluation tend to push up the yen as the yuan's rise will likely in turn boost other Asian currencies by making the exports of each country more competitive.
But Osamu Takashima, chief currency analyst at Bank of Tokyo-Mitsubishi, believes any dollar falls from such speculation will probably be short-lived because of the importance of other factors affecting the dollar's moves.
"Of course the G7 nations will talk about China's currency regime," he said. "But I simply think the issue is no longer the main factor."