The US dollar pared its morning gains against major currencies in late Asian trade after falling overnight in New York, dealers said. There also appears to be heightened concern of a potentially sharp reversal in the yen and euro in the short-term as fundamental factors, like higher interest rates and firm economic growth, are still seen as favoring the US currency. After repeatedly failing to break above 1.2255 usd, euro-dollar players suddenly lost their appetite to take the pair much higher, despite the allure of hefty stops rumored to be sitting above 1.2260 usd resistance. Technical analysts at Singapore United Overseas Bank also said today's move could be just consolidation before "another attempt to move above the key resistance at 1.2255-60 usd." "On the downside, only a move below 1.2120 usd will suggest that a deeper correction is on the way," they said. Dollar-yen also recouped some ground this morning, touching 111.66 yen at the Tokyo fix and then shooting up to 111.90 yen subsequently as the dollar's bounce took out stop loss buy orders placed along the way. "Dollar-yen traded higher almost from the outset as offers from a short-term account around 111.60-65 yen were easily absorbed by Tokyo names buying into the fixing," UBS dealers said. Market participants have also expressed concern over the political environment in Japan as Prime Minister Junichiro Koizumi faces a key test on whether he can push through Parliament a proposed reform of the postal system. A failure of that could lead to fresh elections and that uncertainty has weighed on the yen. The Japanese unit was also plagued by concern of rising oil prices and their impact on the Japanese economy, which depends largely on imported oil for energy needs. Looking ahead, US data releases today include the July ISM non-manufacturing index, which is forecast to fall to a reading of 61.5 after a 4-point jump in June. The highlight of the week however, remains the July nonfarm payrolls data due on Friday.