LONDON, Dec 2: The yen remained under attack against other leading currencies on Monday after Japanese finance minister Masajuro Shiokawa reportedly said the Japanese unit was heavily overvalued at present levels.

The dollar traded at 123.88 yen against 122.64 late on Friday.

The single European currency fell to $0.9897 from 0.9948 late on Friday in New York.

Shiokawa was quoted by Japan’s Mainichi Shimbun newspaper’s website as saying the yen was currently too high and that the dollar should be around 25 per cent above its present level “at around 150-160 yen”.

Analysts said the news had triggered a sell-off in the Japanese unit, although they remained largely sceptical of the accuracy of the comments being attributed to Shiokawa.

I not sure how much people believe Shiokawa said what he’s supposed to have said but the story has nontheless had quite an impact, said Commerzbank chief currency strategist Nick Parsons.

Even though people doubt the actual number which was reported, it reinforces the view that Japan would be happy with a weaker yen, Parsons told AFP.

WestLB Panmure analysts were likewise sceptical Shiokawa would have made “such an off-the-cuff remark” about the dollar-yen exchange rate, which they noted had not traded at such a level since 1990.

The comments appear a little ambitious for the finance minister, particularly considering they are not supported by any change in policy which would encourage such a weakening of the currency, they wrote in note to clients.

Elsewhere the euro was little changed against the dollar as the market awaited Thursday’s interest rate decision by the European Central Bank (ECB).

WestLB analyst Michael Klawitter said: While a rate cut is almost certain, if the ECB decides to cut rates by only 25 basis points rather than the 50 basis points which participants are hoping for, the euro is likely to come under pressure.

The euro was changing hands at 0.9897 dollars from 0.9948 late on Friday in New York, 122.97 yen (122.46), 0.6381 pounds (0.6388) and 1.4776 Swiss francs (1.4748).

The dollar was being quoted at 123.88 yen (122.64) and 1.4920 Swiss francs (1.4828).

The pound was at 1.5532 dollars (1.5567), 192.42 yen (190.90) and 2.3176 Swiss francs (2.3090).

On the London Bullion Market, the price of an ounce of gold fell to $318.25 from 319.05 late on Friday. —AFP