* Regional tension mounts after Pyongyang's missile test
* Yen advances to 5-month highs vs dollar, euro, sterling
* US Treasury's currency report taken in stride
* US declines to name any trade partner as currency
By Shinichi Saoshiro
TOKYO, April 17 The dollar dipped to a
five-month low against the yen early on Monday as rising
tensions over North Korea kept the safe-haven Japanese currency
The dollar was down 0.3 percent at 108.235 yen, its
lowest since mid-November.
The yen remained broadly bid against other currencies as
well. The euro and the pound slid to five-month troughs of
114.955 yen and 136.05 yen, respectively.
Increasing geopolitical risks another notch, North Korea on
Sunday made what was believed to be a failed missile test
launch. Regional tensions have risen over the past weeks as U.S.
President Donald Trump has taken a tough rhetorical line with
"It is unclear whether the situation over North Korea will
escalate into military action, but uncertainty is increasing and
the dollar continues to edge lower. The dollar also looks shaky
technically, after slipping below the 200-day moving average of
108.80 yen," said Masafumi Yamamoto, chief currency strategist
at Mizuho Securities in Tokyo.
With the bulk of the market's focus on how the standoff
between the United States and North Korea will play out, the
semi-annual U.S. Treasury currency report released late on
Friday did not receive as much attention as some had initially
The Trump administration declined to name any major trading
partner as a currency manipulator in the highly-anticipated
report on Friday, backing away from a key Trump campaign promise
to slap such a label on China.
The U.S. Treasury, however, ensured that currency policies
would remain a sticking point going forward by keeping China,
Germany and Japan on a "monitoring list."
"Market reaction, if there was one, to the currency report
has already faded. The U.S. Treasury does not look like it will
take a strong stance on currencies. But in the case of the Trump
administration the market will need to watch out for what his
trade advisors may have to say on this issue," said Yamamoto at
The euro was a shade lower at $1.0608, having spent
the previous session in a very tight range.
The dollar index against a basket of major currencies was
down 0.1 percent at 100.470.
The Australian dollar was steady at $0.7581 while
the New Zealand dollar rose 0.2 percent to $0.7013.
(Editing by Sam Holmes)