The dollar sagged below ¥99 in Tokyo trading Wednesday as selling to lock in profits got the upper hand amid a dearth of fresh dollar-buying incentives.
At 5 p.m., the dollar stood at ¥98.83-85, against ¥99.06-14 at the same time Tuesday. The euro was at $1.3094-3096, against $1.3080-3081, and at ¥129.41-43, against ¥129.62-64.
The greenback briefly climbed above the ¥99 line in the morning, encouraged by a rise in Japanese stock prices, but it had no momentum to advance further.
Solid Chinese trade data for April lifted the Australian dollar and some other major currencies against the yen, but the impact was limited on the dollar-yen pair.
The dollar-yen sector was also little affected by news that the Reserve Bank of New Zealand’s governor has admitted that the bank conducted market intervention over the last month or so to weaken the New Zealand dollar.
The dollar’s rally backed by stronger than expected U.S. jobs data released Friday has apparently run its course, traders said. Still, the jobs data “reconfirmed the market consensus that the dollar will exceed ¥100 in the near future,” an official at a bank-affiliated securities firm said.
The U.S. currency struggled to break the key ¥100 line last month, even after the Bank of Japan announced new monetary easing measures. It again approached ¥100 following the jobs report.
“The dollar needs a powerful cue for breaching its topside, but that’s unlikely for the time being,” a currency strategist said.
Given recent policy rate cuts by the European Central Bank and the Reserve Bank of Australia, “the market is no longer on the trend in which the yen is one-sidedly sold,” an official at a major Japanese bank said.