By Suryatapa Bhattacharya 
 

TOKYO--The U.S. dollar recovered slightly against the yen as investors shook off their disappointment over the GOP's health-care failure and looked toward other stimulus plans by President Donald Trump.

The dollar rose as much as 110.83 yen in early Asia trading before paring gains to trade up 0.3% at Y110.58. On Monday, U.S. dollar fell 1% to Y110.24--its lowest level against the yen since late November--following the failure to repeal Obamacare.

The Wall Street Journal Dollar Index, a measure of the dollar against a basket of 16 currencies, was down 0.2% at 89.64.

"The markets will go up again once they retrain their focus on Trump's economic-stimulus package," said Masayuki Kubota, chief strategist at online brokerage Rakuten Securities.

The failure of the health-care bill hasn't derailed market sentiment about fiscal stimulus, said Paul Ashworth, chief U.S. economist for Capital Economics, who expects a $2 trillion package of tax cuts to be passed by early next year. Even if there was a "complete legislative gridlock," Mr. Ashworth said a strong pickup in global economic growth should help matters along. The recent uptick in market sentiment comes from global growth momentum, which began "well before Trump's surprise election victory," he said.

The earnings repatriation by Japanese exporters, who typically buy the yen in late March when Japan's fiscal year ends, has added to recent pressure on the dollar-yen pair, said Takashi Hiroki, chief strategist at Monex Securities in Tokyo. He said he expects the dollar to trade around Y110.50-Y111 in the near term.

Meanwhile, ahead of the French presidential election next month, incremental but important political victories across Europe has helped to calm investor uncertainty over the euro, said Rakuten's Mr. Kubota. German Chancellor Angela Merkel's center-right party passed a key test this week as the country kicked off election year in Germany. And the U.K.'s talks to exit the European Union ahead of the Brexit announcement Wednesday showed "there is a soft-Brexit expectation among investors," Mr. Kubota said.

The euro was up 0.4% at $1.0869.

 
Interbank Foreign Exchange Rates At 00:50 EST / 0450 GMT 
 
                         Latest     Previous   %Chg   Daily   Daily    %Chg 
                                    2150 GMT          High    Low      12/31 
Dollar Rates 
USD/JPY Japan           110.57-58      110.66-67  -0.08   110.83   110.53  -5.49 
EUR/USD Euro            1.0866-69      1.0862-65  +0.04   1.0871   1.0856  +3.31 
GBP/USD U.K.            1.2568-70      1.2557-59  +0.09   1.2572   1.2556  +1.81 
USD/CHF Switzerland     0.9850-54      0.9854-58  -0.04   0.9864   0.9849  -3.31 
USD/CAD Canada          1.3379-84      1.3376-81  +0.02   1.3393   1.3376  -0.45 
AUD/USD Australia       0.7615-19      0.7617-21  -0.03   0.7636   0.7612  +5.76 
NZD/USD New Zealand     0.7036-42      0.7040-46  -0.06   0.7050   0.7035  +1.65 
 
Euro Rates 
 
EUR/JPY Japan           120.14-18      120.20-24  -0.05   120.40   120.08  -2.39 
 
Source: Tullett Prebon 
 

Write to Suryatapa Bhattacharya at suryatapa.bhattacharya@wsj.com

(END) Dow Jones Newswires

March 28, 2017 02:25 ET (06:25 GMT)