The safe-haven currencies such as the U.S. dollar and the yen strengthened against their major counterparts in the Asian session on Tuesday, as investors fret about a Greek bailout and the possibility of an early election in Italy.
Greece has warned that its recovery would be thrown into doubt if Brussels blocked a debt deal at the next meeting of euro area finance ministers. Reports suggest that Athens may opt out of its next bailout payment if creditors cannot agree on debt relief.
Speculation over a possible early election in Italy intensified after rivals Matteo Renzi and Beppe Grillo edged closer to a deal on rewriting Italy's electoral law.
Investors also keep an eye on the U.S. jobs report due this Friday after Fed Bank of San Francisco President John Williams said three interest-rate increases this year makes sense.
ECB President Mario Draghi told European lawmakers in Brussels that the euro zone economy still needs a "fairly substantial amount" of monetary stimulus to restore stable inflation.
Trading volumes remained thin across the region amid public holidays in China, Hong Kong and Taiwan.
In other economic news, data from the Ministry of Internal Affairs and Communications showed that Japan's jobless rate held steady at 2.8 percent in April, the lowest since June 1994. The rate also came in line with expectations.
The jobs-to-applicants ratio came in at 1.48 in April versus 1.45 in March. This was the highest since 1974 and marginally above the expected level of 1.46.
In the Asian trading, the U.S. dollar rose to near 2-week highs of 1.1122 against the euro, 0.9794 against the Swiss franc, and 0.7416 against the Australian dollar, from yesterday's closing quotes of 1.1163, 0.9773 and 0.7438, respectively. If the greenback extends its uptrend, it is likely to find resistance around 1.08 against the euro, 0.99 against the franc, and 0.72 against the aussie.
Against the pound,the New Zealand and the Canadian dollars, the greenback advanced to 4-day highs of 1.2794, 0.7035 and 1.3477 from yesterday's closing quotes of 1.2839, 0.7054 and 1.3449, respectively. The greenback may test resistance around 1.24 against the pound, 0.69 against the kiwi, and 1.37 against the loonie.
The yen rose to a 7-week high of 141.82 against the pound, from yesterday's closing value of 142.82. The yen may test resistance around the 138.00 region.
The yen advanced to near 2-week highs of 123.25 against the euro and 113.17 against the Swiss franc, from yesterday's closing quotes of 124.20 and 113.79, respectively. If the yen extends its uptrend, it is likely to find resistance around 121.00 against the euro, and 110.00 against the franc.
Against the U.S. and the Australian dollars, the yen climbed to near 2-week highs of 110.77 and 82.23 from yesterday's closing quotes of 111.26 and 82.76, respectively. On the upside, 108.00 against the greenback and 81.00 against the aussie are seen as the next resistance level for the yen.
Against the New Zealand and the Canadian dollars, the yen rose to 1-week highs of 77.99 and 82.22 from yesterday's closing quotes of 78.45 and 82.65, respectively. The yen is likely to find resistance around 76.00 against the kiwi and 80.00 against the loonie.
Looking ahead, Swiss KOF leading indicator for May and Eurozone business climate index for May are due to be released later in the day.
In the New York session, the German preliminary CPI data for May, Canada industrial product price and raw materials price indexes for April, U.S. personal income and spending data for April, U.S. S&P case-shiller home price index for March, and U.S. consumer confidence index for May are slated for release.
At 1:00 pm ET, Federal Reserve Board Governor Lael Brainard is expected to speak on the economy and monetary policy before the New York Association for Business Economics Luncheon Speaker Series, in New York.
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