Yen nears 2026 high as oil prices weigh on stocks

The yen extended gains on Tuesday, briefly reaching 152.89 against the dollar as investors increased bets on Bank of Japan interest rate rises.

The move put the Japanese currency close to 152.10, its strongest level of 2026, touched in February. Around 0810 GMT, the dollar was at 153.80 yen, compared with 154.24 yen on Monday.

Oil prices also rose, adding pressure to equity markets and to inflation concerns. Brent crude was up 2.2 percent at $99.15 a barrel, while West Texas Intermediate was up 3.1 percent at $94.31.

Tokyo's Nikkei 225 closed down 1.7 percent, Hong Kong's Hang Seng Index fell 0.4 percent and Seoul ended lower after earlier gains. London, Paris and Frankfurt were also in the red, while Shanghai, Manila and Jakarta rose.

Investors were also looking ahead to US consumer price data due Friday. CME Group's FedWatch tool put the chance of a Federal Reserve rate increase at more than 60 percent after strong US jobs figures last week.

Stephen Innes at Quintex Intel said markets were facing several risks at once, including possible US and Japanese rate moves, oil near triple digits and renewed tariff threats against Canada.