Tokyo, Feb 13: The dollar slipped on Tuesday as investors booked profits on its climb to near a fou

Tokyo, Feb 13: The dollar slipped on Tuesday as investors booked profits on its climb to near a four-year high against the yen after the Group of Seven industrial powers failed to single out the Japanese currency's weakness.

The G7's post-meeting communique over the weekend said market players should consider the risks tied to Japan's economic recovery, and officials afterwards warned against making one-way bets in the currency market.

But the lack of stronger vocal support suggested that the G7 would leave it to financial markets to correct the weak yen, helping drive the euro to a record high of 159.00 yen on Monday.

''There was a lot of talk there could be some comments or mention of concern on the weaker yen. But I don't think this idea is fully shared by G7 members, just the European authorities,'' said Kikuko Takeda, currency strategist at Bank of Tokyo-Mitsubishi UFJ.

Investors are now awaiting this week's congressional testimony on the economic outlook from Federal Reserve Chairman Ben Bernanke that kicks off on Wednesday for clues on the monetary policy outlook.

The dollar has gained some support this year as market players see less chance of the Fed cutting interest rates from 5.25 per cent, which would help maintain the U.S. currency's relatively alluring yield.

The dollar fell 0.2 per cent from late New York trade to 121.65 yen after climbing as high as 122.05 yen the previous session, near the four-year peak of 122.20 yen struck in January.

Traders said they expected some dollar selling from Japanese exporters for their hedging needs as Japanese financial markets re-opened after a three-day weekend.

The euro also edged down 0.2 per cent to 157.70 yen. The euro was little changed near $1.2960.

For the yen, this week's key event is fourth-quarter growth data on Thursday that will be the last big piece of news before the Bank of Japan's policy meeting next week.

Economists forecast growth to have accelerated to a 3.8 per cent annualised pace from 0.8 per cent in the July-September period.

Analysts said an unexpectedly soft figure could stir more doubts about when the BOJ will next raise rates and further feed the yen selling pressure.

Swap contracts on the overnight call rate show a roughly 35 per cent chance of the BOJ lifting rates to 0.5 per cent from 0.25 per cent at the Feb. 20-21 gathering.

Reuters