The yen fell against the and the euro while the ruble rebounded on Tuesday after signs that Russia may be seeking to avoid further escalation of its military involvement in Ukraine pared bids for safe-haven currencies.
The euro had fallen sharply against the yen, which investors favor in times of geopolitical tension, after Western powers threatened over the weekend to take steps to isolate Russia economically, raising a host of risks for Western Europe and the global economy.
But a selloff in the ruble and Russian assets halted on Tuesday, and investors pulled money out of the perceived safety of the yen, with sentiment boosted by Russian President Vladimir Putin's ordering some troops in Russia back to base.
Putin later told a news conference he saw no need to use military force in Ukraine's Crimea region for now.
The surprise for some traders has been the extent to which major currencies have taken in stride the West's biggest confrontation with Russia since the Cold War, although many analysts had reckoned the United States and Europe were unlikely to opt for a military response.
The euro and the dollar rose against the yen to 140.31 and 102.00 , respectively. The euro rose about 0.16 percent to nearly $1.38.
On Monday, the single currency fell 0.5 percent and 0.8 percent versus the greenback and yen, respectively.
The Swiss franc, also seen as a safe haven, retreated from its strongest in a year against the euro, trading near 1.22 francs compared to the Swiss National Bank's cap of 1.20.
Putin's stand of no further military action on Ukraine stoked a bounce in the ruble. The dollar declined 0.9 percent against the Russian currency at 36.16 rubles, retracing much of the 1.3 percent rise on Monday.
Opinion is divided over the European Central Bank's likely course of action at a policy meeting on Thursday.
A higher-than-expected inflation number last Friday prompted many to pare bets on outright easing of interest rates but that is not the only action the bank can take.
An ECB source told Reuters there would be unanimous agreement to end so-called sterilization of the bank's bond purchases under the bank's Securities Markets Program.
UBS is also among the many banks predicting a stronger dollar this year, and on-farm payrolls data on Friday could show a more bullish increase of 150,000 jobs in February.
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