LONDON, Dec 19: The dollar steadied on Monday against the euro but clawed back ground against the yen following last week’s unexpected surge in the Japanese currency, analysts said.

Meanwhile, dealers said trading activity was likely to fall quite rapidly over the week before the Christmas and New Year holidays.

The euro firmed to $1.2013 in European trading on Monday, from $1.2010 late on Friday in New York.

The dollar rose to 116.30 yen from 115.64 yen on Friday.

The foreign exchange market looks becalmed following last weeks turbulence, Commerzbank economist Gavin Friend noted.

Bank of Tokyo-Mitsubishi economist Derek Halpenny added that “the dollar has managed to recoup some of its losses suffered against the yen last week, with dollar buyers encouraged back into the market after the dollar/yen rate held above the key 115.00 level.

In the absence of new economic data, the European single currency steadied at about $1.20 on Monday. Concerns that the US Federal Reserve was near the end of its rate-rising cycle put the dollar under pressure against the yen for much of last week.

A currency strategist at BNP Paribas, Ian Stannard, added that a corrective rebound for the dollar is likely following the sharp declines last week, especially against the yen.

The dollar has been buoyed for most of this year, following a three-year downturn, by a growing focus on interest rate developments around the world.

—AFP