The JPY gained broadly this morning as Asian equity markets traded in the red according to Reuters, prompting a pullback in risk trades and a move into the low-yielding JPY. Risk appetite had been boosted by Friday's better-than- expected U.S. employment report, pushing the JPY down to two-week lows versus the EUR and the USD.

However, a lack of follow-through at the start of the new week had left traders searching for fresh impetus according to a Reuters report. Traders said Japanese exporters were in the market buying JPY fairly actively, with further demand for the JPY likely into fiscal year-end on March 31. Further yen gains may be limited by speculation that the Bank of Japan may take further steps to ease monetary policy. The BOJ is in the spotlight after the Nikkei newspaper reported on Friday that it was examining easing again and may decide on such a move when it meets on March 16-17.

The EUR was slightly softer versus the USD at $1.3605 after struggling on Monday as Greek Prime Minister George Papandreou warned if the Greek crisis worsened it could lead to a new global financial meltdown. Worries over Greece's and other peripheral euro zone countries' debts have weighed on the EUR, driving it down over 10% from its November 2009 highs. Greek Finance Minister George Papaconstantinou was due to meet the IMF informally in Washington, an IMF official said yesterday.

The DXY was unchanged versus a basket of currencies at 80.495, though it remained close to its 2010 high of 81.342.

GBP was under pressure after data showing British house prices grew last month at their slowest pace since August weighed on sterling. Another negative factor for the GBP was a Moody's Investors Service report saying Britain faces a difficult balancing act in deciding how and when to reduce support for the banking sector, given growth in the UK's public debt burden.