The yen rose against the dollar and euro on Monday as stocks fell amid inflation concerns and continuing problems in financial markets.

The euro, which fell steeply against the dollar last week, had initially gained after a top European Central Bank official said it organization was still focused on fighting inflation, lowering the chance of further interest rate cuts. That statement was a shift from what investors had been expecting.

Speculation for higher rates last week rose when ECB president Jean-Claude Trichet said growth risks in the euro zone were on the downside. The region is experiencing inflation pressures, with inflation at a 14-year high.

Meanwhile, over the weekend, The Group of Seven nations, among the leading industrialized nations in the world, said that global banks will continue to experience troubles, taking more than $400 million in write downs due to the struggling U.S. subprime housing market.

The yen rose to 106.88 versus the dollar in New York at 3:49 p.m. from 107.30 late Friday. It climbed to 155.21 per euro, from 155.71. The euro was trading at 1.4520 after a 2 percent drop last week, the most in a year and a half.