The euro hovered near a three-week high on Friday, standing atop big gains made overnight after the European Central Bank roiled markets by suggesting that it was done cutting interest rates for now.
The safe-haven yen rose against the dollar as equities reacted negatively to the ECB's forward guidance, with Tokyo's Nikkei .N225 slipping 1.5 percent.
The ECB on Thursday rolled out a series of bold easing measures as expected, including an expansion in asset buying and a deeper cut to already negative deposit rates.
The euro rallied hard, however, after ECB President Mario Draghi undid the very stimulus he hoped to achieve by signaling there would be no further rate cuts.
The common currency was near the three-week peak of $1.1218 EUR= scaled overnight, when it jumped 1.6 percent against the greenback. German two-year bund yields posted their biggest daily rise in three months overnight, helping shore up the euro.
The dollar index suffered big losses on the euro's broad strength, struggling near a one-month low of 95.939 .DXY.
Draghi's suggestion that the ECB's easing steps may have limits was expected to temper investor confidence and hurt riskier currencies.
"The ECB's latest stance comes at a time when commodities and oil appeared ready for a corrective fall after their late gains," said Junichi Ishikawa, FX analyst at IG Securities in Tokyo.
"Risk aversion could be next week's theme, potentially pushing dollar/yen back towards 111.00 yen."
Crude oil prices edged up in early trading on Friday supported by a weaker dollar, which makes oil cheaper for countries using other currencies, and investment money.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were trading at $38.11 per barrel at 0048 GMT (7.48 p.m. EDT), up 27 cents from their last close.
Traders said that the price support came from a weaker dollar, which on Thursday fell by 2.5 percent against a basket of currencies .DXY in volatile trading after the European Central Bank eased aggressively.
The dollar was down 0.3 percent at 112.835 JPY= against the safe-haven yen, well off this week's peak of 114.45 struck early on Thursday. The dollar fell to a 16-month low below 111 last month on a bout of global risk aversion.
Friday's stronger prices came following losses the previous day after a meeting between major producers to coordinate a freeze in output looked unlikely to even take place without Iran committing.
Freed from international sanctions that more than halved its output to little more than 1 million barrels per day (bpd), Iran said it would not participate in a proposed agreement between top producers Saudi Arabia and Russia to freeze production at January levels, when both pumped over 10 million bpd.
North Korean leader Kim Jong Un watched a ballistic missile launch test and ordered the country to improve nuclear attack capability by continuing to conduct more tests, the official KCNA news agency reported on Friday.
The report did not say when the test took place but it was likely referring to the launch of two short-range missiles by North Korea on Thursday that flew 500 km (300 miles) and splashed into the sea.
Reference: Reuters
Thai
Eng