Dollar falls back to ¥98.10 range


The dollar traded on a weak note around ¥98.10 in Tokyo trading Friday, due to risk-averse sentiment after a fall in stock prices.

At 5 p.m., the dollar stood at ¥98.12-13, off from ¥98.32-35 at the same time Thursday. The euro was at $1.3551-3553, down from $1.3699-3700, and at ¥132.98-99, down from ¥134.70-73.

After hovering around ¥98.35 in early trading, the dollar was hit by selling to lock in profits.

The U.S. currency came under renewed selling pressure and fell below ¥98 in early afternoon trading in line with a fall in Tokyo stock prices.

“As the euro lost ground sharply, especially against the yen, extending the previous day’s falls, the dollar also slipped versus the yen,” an official at a foreign exchange broker said.

The euro drew position-adjustment selling against the yen before the three-day weekend, market sources said. Tokyo financial markets will be closed Monday for Culture Day.

After European players joined trading in late hours, the dollar gained ground moderately and rose back above ¥98.

With the end of monetary policy meetings of the Bank of Japan and the U.S. Federal Reserve this week and before the three-day holiday, “dollar-yen trading is generally lacking a clear direction,” a foreign exchange analyst said.

Some market participants are becoming optimistic about the course of the U.S. economy following a sharp improvement in the Chicago purchasing managers index for October, released Thursday, market sources said. The index hit the highest level in two years and seven months.

A foreign bank official said the dollar’s topside will be limited for a while due to the possibility of the U.S. government facing a fiscal problem again in December.