* Concerns about N. Korea, Syria offset Fed rate hike
* Euro remains pressured by French election uncertainty
TOKYO, April 11 The dollar fell in Asian trading
on Tuesday, as concerns over tensions with North Korea and Syria
weighed on U.S. Treasury yields and offset expectations of U.S.
interest rate hikes.
The dollar index, which gauges the U.S. currency against a
basket of six major peers, edged down 0.1 percent to 101.950
The dollar dropped 0.2 percent to 110.68 Japanese yen
, moving away from its overnight high of 111.57. It
remained solidly in the 110.11-112.19 range in which it has
traded since late March.
China and South Korea agreed on Monday to impose tougher
sanctions on North Korea if it carries out nuclear or long-range
missile tests, a senior official in Seoul said, as a U.S. Navy
strike group headed to the region in a show of force.
The possibility of U.S. military action against North Korea
in response to such tests gained traction following last week's
U.S. strikes against Syria in retaliation for a chemical weapons
attack on civilians by President Bashar al-Assad's forces.
The benchmark 10-year yield fell to 2.353 percent
in Asian trading, from its U.S. close of 2.361
percent on Monday.
"U.S. interest rate increases and the Fed's balance sheet
reduction remain key factors on which people are taking dollar
positions," said Mitsuo Imaizumi, Tokyo-based chief
foreign-exchange strategist for Daiwa Securities.
"But there is position-squaring whenever risk aversion
rises," he said. "Whenever there is any news about terrorism, or
Syria, or North Korea, there is some adjustment of positions."
The Federal Reserve's plans to raise U.S. interest rates
gradually are aimed at sustaining full employment and
near-2-percent inflation without letting the economy overheat,
Fed Chair Janet Yellen said on Monday, reinforcing the central
bank's message and offering no fresh clues on the policy
The euro was steady on the day at to $1.0599 after
plumbing $1.0568 overnight, its lowest level since March 9, amid
uncertainty ahead of France's upcoming presidential election.
Opinion polls indicate far-right candidate Marine Le Pen and
centrist Emmanuel Macron will come out ahead in the April 23
first round and make it to the May 7 run-off, with Macron
winning. But leftist firebrand Jean-Luc Melenchon has seen his
ratings surge and conservative Francois Fillon, damaged by a
nepotism scandal, has also regained some lost ground.
Le Pen drew protests from her election rivals and the
Israeli government on Monday by denying the French state's
responsibility for a mass arrest of Jews in Paris during the
second World War.
(Reporting by Tokyo markets team; Editing by Eric Meijer)