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Forex - Yen weakens as Fed's Lockhart sticks with liftoff, China eyed - Asian currencies showed volatility on Tuesday with the Aussie rebounding smartly and the yen giving up overnight gains in a thin regional data day with a background of U.S. rate expectations setting the tone.

In a speech in the U.S. late on Monday, Atlanta Federal Reserve Bank President Dennis Lockhart said he expects the Fed to start raising interest rates sometime before year's end and to do so gradually.

Lockhart, who not long ago said he expected the Fed's rate-setting the Federal Open Market Committee to raise the federal funds rate from near zero at its Sept. 16-17 meeting, did not repeat that prediction, but neither did...