Dollar dips ahead of key events


The dollar fell below ¥99.30 in Tokyo on Thursday as profit-taking intensified ahead of major economic events Friday.

At 5 p.m., the dollar was quoted at ¥99.20-24, down from ¥99.50-50 at the same time Wednesday. The euro stood at $1.3031-3032, up from $1.2991-2994, and at ¥129.25-33, compared with ¥129.25-29.

The dollar rose to around ¥99.60 shortly before midmorning, supported by the firmness of Japanese stock prices, traders said.

But dollar purchases lost momentum later for lack of fresh trading pegs, they said. The greenback fell to levels around ¥99.00 briefly in the afternoon.

The dollar’s drop stemmed partly from weaker than expected U.S. durable goods orders for March, according to traders.

Another drag came from dollar sales placed ahead of the Bank of Japan’s monetary policy meeting and the U.S. announcement of January-March gross domestic product data, both slated for Friday, they said.

But the dollar drew purchases at lows. “Its downside was firmly supported,” said an official of a foreign-exchange margin trading service firm.

“Considering the weakness of the endurable goods data, the dollar was resilient,” a major bank official said. “It seems that many players are itching to attempt a break through ¥100.”

The dollar is expected face decreased resistance at highs because many no-touch options contracts that guarantee profits to investors as long as the dollar stays below ¥100 are believed to expire soon, another major bank official said.

Whether the dollar can clear the ¥100 line will hinge on what the BOJ has to say in its Outlook for Economic Activity and Prices report on Friday, traders said.