The yen rose against the dollar on Thursday after sources close to the White House told Reuters a trade deal between the United States and China was unlikely this year, shattering investors and hoping for an imminent partial deal and driving demand for safe havens.
The yuan fell to its lowest level in three weeks in domestic trade on fears that failure to reach a deal to cut US tariffs could further hurt China's faltering economy.
Political tensions between Beijing and Washington also kept investors on guard after a source told Reuters that US President Donald Trump was expected to sign two bills aimed at supporting anti-government protesters in Hong Kong.
The yen rose 0.15% to 108.46 against the dollar on Thursday.
The Japanese currency pared gains briefly after Bloomberg said Chinese Vice Premier Liu He said he was cautiously optimistic about the initial trade deal. However, markets turned back when it became clear that the comments were released Wednesday evening in Beijing.
The dollar was steady at $ 1.1077 against the euro, and was trading at $ 1.2931 against GBP
Washington and Beijing have imposed tariffs on each other's goods in a bitter dispute over Chinese trade practices that the US government says are unfair.
