The dollar retook ¥98 on Thursday in Tokyo as the yen was sold, reversing the previous day’s safe-haven buying in response to the tense Syrian situation.
At 5 p.m., the dollar was quoted at ¥98.14-18, up from ¥97.48-50 at the same time Wednesday. The euro stood at $1.3263-3264, down from $1.3379-3380, and at ¥130.13-23, down from ¥130.43-45.
The dollar came under downward pressure Wednesday due to mounting expectations of U.S. and European military intervention in Syria, but it firmed Thursday as the flight to safety took a breather, traders said.
After Tokyo stocks got off to a robust start and extended gains, yen selling against the dollar accelerated.
“Stop-loss selling of the Japanese currency was triggered by the greenback’s rise to around ¥98,” a market source said.
“The dollar attracted buybacks after heated selling amid rapidly increased risk-averse sentiment,” a major Japanese bank official said.
Market jitters over the Syrian situation weakened somewhat because the anticipated military intervention is unlikely to happen soon, traders said.
In addition, President Barack Obama suggested strikes on Syria would be carried out swiftly so the United States can avoid getting embroiled in an open-ended conflict, said an official of a foreign exchange margin trading firm.
The military action, if any, would have only a limited impact on the currency market, a major bank official said.
For now, the market shifted its focus from Syria to economic indicators due out later Thursday, such as revised U.S. gross domestic product data for April-June and weekly jobless claims.