Asian shares rise, Yen edges up

By Masayuki Kitano

SINGAPORE (Reuters) - The yen edged higher on Monday after Japan's economics minister said further weakness in the yen could harm households, while Asian shares rose in response to U.S. equities rallying on upbeat economic data.

European shares were seen rising at the open on Monday. Financial spreadbetter IG expected Britain's FTSE 100 to open 0.3 percent higher, Germany's DAX to open 0.7 percent higher, and France's CAC 40 to gain 0.5 percent.

The dollar fell to as low as 102.00 yen earlier on Monday, pulling away from Friday's high of 103.32 yen, the greenback's highest level versus the yen since October 2008.

The dollar last stood at 102.68 yen, down 0.5 percent on the day, having pared some of its earlier losses.

Comments by Japanese Economics Minister Akira Amari over the weekend spurred buy backs of the yen, market players said.

"People say the excessively strong yen has corrected quite a bit. If the yen continues to weaken steadily from here, negative effects on people's lives will emerge," Amari told a Sunday talk show.

Still, some analysts played down Amari's remarks, saying the market's main focus is the outlook for U.S. monetary policy, as well as a recent trend toward a broadly higher dollar.

"The moves are due to the dollar's strength rather than the yen's weakness, so there's more focus on what the Fed does or says than statements from Japanese politicians," said Yoshio Takahashi, currency strategist at Barclays in Tokyo.

Asian stock markets rose broadly, boosted by U.S. equities hitting record closing highs on Friday as encouraging economic data prompted investors to buy into growth companies.

In the stock market, MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.9 percent. Australian shares rose 0.6 percent. In China, the Shanghai Composite Index rose 0.9 percent.

Thai equities rose 0.7 percent, staying firm even after data showed Thailand's economy shrank 2.2 percent in the first three months of 2013 from the previous quarter.

Japan's Nikkei share average touched its highest intraday level since December 2007, and was last up 1.4 percent, with sentiment supported after the Japanese government raised its assessment of the economy in May.

The dollar index, which measures the dollar's value against a basket of currencies, stood at 84.091. On Friday, the dollar index had risen to 84.371, its strongest level since July 2010.

The dollar has been buoyed by speculation that the Fed might taper its $85 billion in monthly bond purchases later this year.

Such chatter had increased after John Williams, president of the Federal Reserve Bank of San Francisco, said on Thursday the Fed could begin easing back on the monetary gas pedal this summer and end bond buying late this year.

Gold tumbled 1.5 percent to a one-month low of $1,338.95 earlier on Monday, pressured by expectations the Fed could soon halt its asset buying programme. Gold last fetched $1,345.41.

Brent crude held steady at $104.60 a barrel.

(Additional reporting by Ian Chua in Sydney, Sophie Knight and Ayai Tomisawa in Tokyo; Editing by Eric Meijer)