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Dollar weakens amid Ukraine crisis

JIJI

The dollar trimmed early losses and recovered the ¥102.10 line in Tokyo trading Thursday but failed to extend its gains due to a lack of additional positive factors.

At 5 p.m., the dollar was clocked at ¥102.10-11, down from ¥102.28-32 at the same time Wednesday. The euro was at $1.3772-3773, down from $1.3814-3817, and at ¥140.63-64, down from ¥141.31-31.

The dollar carried over its weak tone from overnight trading overseas, where it came under selling pressure after President Barack Obama threatened new sanctions targeting Russia’s energy section over the crisis in Ukraine.

The dollar also came under pressure as the U.S. Federal Reserve rejected the capital plans of five major banking groups, including Citigroup Inc., after its stress tests, market sources said.

In early trading in Tokyo, the dollar slipped below ¥101.80 due to falls in stocks prices and selling by real demand-backed players.

The dollar later attracted buybacks as Tokyo stocks recouped early losses and closed higher.

“The dollar drew purchases mainly from Japanese importers at levels below ¥102,” an official at a foreign exchange brokerage firm said.

“As there were few dollar-positive factors other than the rise of the stock market, it seems difficult for the dollar to chase higher ground,” another broker said.

The dollar faced strong selling pressure at levels around ¥102.50, market sources said.

Given that recent U.S. economic data have shown some weakness, including durable goods orders for February, released Wednesday, an official at a major U.S. bank said market participants are refraining from dollar purchases for now, capping the U.S. currency’s upside.