Dollar wavers amid renewed Iran attacks, yen slides on pensions doubts

The Japanese yen slid against the dollar on Monday after Reuters reported that Tokyo had no imminent plans to change the asset allocations of its state pension funds.

The dollar was last up 0.2% at 162.05 yen, putting traders back on alert for possible intervention from authorities in Tokyo as the Japanese currency continues to languish at 40-year lows.

The yen and Japanese bonds had rallied on Friday after Finance Minister Satsuki Katayama said the government would seek ways to encourage pension funds, including the Government Pension Investment Fund (GPIF), to make greater investments in Japanese financial assets.

While the government is exploring ways to boost such investments within the existing allowable ranges of the benchmark portfolio, the initiative will not lead to immediate revisions to GPIF's medium-term objectives, two government sources told Reuters.