LONDONSINGAPORE, Dec 11 Reuters The U.S. dollar rallied against Japan39;s yen on Monday after a report said the Bank of Japan saw little need to end negative interest rates in December, contrary to some investors39; expectations.

Meanwhile, China39;s yuan fell to a threeweek low after data showed deflation in the country worsened in November.

The greenback rose as high as 146.46 yen and last bought 146.08 yen, up 0.78. That reversed some of the steep fall against the Japanese currency late last week, when bets grew that the Bank of Japan may end negative interest rates as soon as next week.

Bloomberg reported on Monday that BOJ officials have yet to see enough evidence that wage growth is strong enough to justify ending its ultraloose monetary policy this month, citing people familiar with the matter.

The dollar39;s rise against the yen helped push the dollar index , which tracks the currency against six peers, up 0.15 to 104.12.

This isn39;t surprising, said Simon Harvey, head of FX analysis at Monex Europe. It just goes to show there isnt a free lunch when it comes to speculating on the Bank of Japan.

We think that January poses a more opportune moment rather than December. Next week39;s meeting is going to come in thinner liquidity positions, there isnt as much space to follow up in terms of navigating markets through the change in conditions.

The euro was last flat at 1.0761, not too far from Friday39;s more than threeweek low of 1.0724, while sterling was…