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Tokyo (ANTARA News) - The dollar hovered close to eight-year lows against the yen in Asian trade on Tuesday as traders avoided risks after a stream of bad news from credit markets, dealers said.

The dollar was changing hands at 101.77 yen in Tokyo afternoon trade against 101.73 late Monday in New York.

The dollar slipped to 101.42 yen in early trade, coming close to Friday's low of 101.40, which was the weakest since 2000.

The euro firmed to 1.5362 dollars from 1.5345 and to 156.46 from 156.11.

"The dollar continues to be sold on falling US shares and credit insecurity, which is in turn supporting currencies like the Swiss franc and the yen," chief strategist at Sumitomo Mitsui Banking Corporation (SMBC) Daisuke Uno told AFP.

Investors shunned risky positions and rushed to safe-haven assets including commodities such as oil, gold and US Treasuries.

Markets were jittery about new signs of credit market problems that triggered losses on Wall Street on Monday.

A source said Lehman Brothers was slashing five percent of its staff due to market conditions while Bear Stearns issued a statement denying market rumours that it was suffering a cash crunch after its shares plunged 11 percent.

US private equity group Blackstone meanwhile reported a quarterly loss as the firm booked writedowns due to credit market difficulties.

Global markets have seen volatile trade since last year on mounting losses in the US subprime sector as customers who received housing loans despite patchy credit histories default on mortgages.

There are growing signs that the US economy is heading for or is already in recession.

The US Federal Reserve is expected to cut its benchmark rate by at least 50 basis points at its March 18 meeting. Markets have also been rife with speculation about a possible emergency cut before that.

Further rate cuts are expected to keep the dollar under pressure as investors seek higher yields elsewhere. (*)

Source