The Japanese yen dropped against its major opponents in the early European session on Tuesday amid risk appetite, as Chinese authorities signaled an easing of curbs on the real estate sector and pledged to stabilize the economy.

China Communist Party's Politburo meeting memo on Monday indicated that policymakers are determined to support the private housing market to prevent the downturn from spreading into broader economy.

China's central bank on Monday reduced the reserve requirement ratio for banks by 50 basis points, which will release 1.2 trillion yuan in long-term liquidity.

Premier Li Keqiang signaled that there is scope for a variety of monetary policy tools to shore up growth in 2022.

Data from the Ministry of Internal Affairs and Communications showed that Japan household spending fell 0.6 percent on year in October - coming in at 281,996 yen.

That was in line with expectations following the 1.9 percent annual drop in September.

The yen dropped to a 1-week low of 113.74 against the greenback, 6-day lows of 128.47 against the euro and 151.13 against the pound, off its early highs of 113.40, 127.94 and 150.35, respectively. The yen is likely test support around 116.00 against the greenback, 130.00 against the euro and 153.00 against the pound.

The yen fell to a 4-day low of 77.02 against the kiwi, 6-day low of 80.64 against the aussie and a 1-week low of 89.38 against the loonie, following its prior highs of 76.42, 79.86 and 88.83, respectively. The next possible support for the yen is seen around 79.00 against the kiwi, 82.00 against the aussie and 91.00 against the loonie.

The yen reached as low as 123.02 against the franc, falling from a high of 122.44 seen at 5:30 pm ET. If the yen slides further, it may find support around the 124.5 level.

Looking ahead, German ZEW economic sentiment index for December, Eurozone GDP and employment data for the third quarter are set for release in the European session.

U.S. and Canadian trade data and U.S. consumer credit, all for October, and Canada Ivey PMI for November will be featured in the New York session.

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