The currency also traded near a one-month high versus the euro after crude oil fell to a 13-week low, bolstering the economic outlook of the U.S., the world's largest consumer of the fuel. The Australian dollar traded near a three-month low on speculation the nation's central bank will signal after a meeting today policy makers are preparing to cut borrowing costs.
The dollar traded at 108.19 yen as of 9:03 a.m. in Tokyo from 108.27 yen in New York yesterday. It touched a four-month high of 108.58 yen on June 16. The U.S. currency was at $1.5563 per euro from $1.5576 yesterday. It touched $1.5515 on Aug. 1, the strongest level since June 24. The euro traded at 168.38 yen from 168.64 yen. The U.S. currency may rise to 108.60 yen today, Saito forecast.
The Australian dollar slid to 92.70 U.S. cents, a three- month low, before the Reserve Bank of Australia meeting at which policy makers will keep the benchmark rate at 7.25 percent, according to all 24 economists surveyed by Bloomberg News. The bank will announce its decision at 2:30 p.m. in Sydney.
The U.S. dollar may rise for a second day against the euro after crude oil fell below $120 a barrel for the first time since May. The euro-dollar exchange rate and oil have had a correlation of 0.9 in the past year, according to Bloomberg calculations. A reading of 1 would mean they moved in lockstep.
The euro fell 0.9 percent versus the dollar last week on concern the economy in the region is slowing. It fell in each of the past three weeks.
The Fed will keep its target rate for overnight loans between banks at 2 percent today and the ECB will hold its main refinancing rate at 4.25 percent on Aug. 7, according to the median forecast of economists in separate Bloomberg News surveys. The Fed will announce its decision at 2:15 p.m. in Washington.
Fed Chairman Ben S. Bernanke last month abandoned his earlier assessment that risks to growth ``diminished,'' saying the U.S. faces threats to price stability and economic expansion.