05:08 AM EDT, 06/04/2024 (MT Newswires) -- The Japanese yen rose against a strengthening US dollar while outperforming other major currencies during early European trade on Tuesday as risk assets came under pressure and government bonds rallied, pushing yields lower.

USD/JPY was quoted 0.51% lower around 155.29, a two-week low for the pair, making the Japanese yen the best-performing G10 currency amid widespread signs of risk aversion among investors in Europe and Asia.

With the exception of the Shanghai Composite Index, major stock gauges fell in Asia and Europe on Tuesday while government bond markets rallied, leading yields to fall across the board including in Japan.

Some analysts attributed the price action to Monday's weaker-than-expected reading of the US ISM Manufacturing PMI, which signaled a deepening of the recession in the US industrial sector during May and a further moderation of inflation pressures.

The yen may also have been helped on Tuesday by remarks from Bank of Japan Governor Kazuo Ueda, who reportedly told a parliamentary committee that interest rates could rise again if inflation is in line with the bank's forecasts in the months ahead.