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Dollar cuts gains to move around ¥113.30 in late Tokyo

JIJI

The dollar gave up some of its early gains to trade around ¥113.30 in Tokyo trading late Friday, with investors retreating to the sidelines in the absence of fresh trading incentives.

At 5 p.m., the dollar stood at ¥113.28-29, up from ¥113.11-13 at the same time on Thursday. The euro was at $1.1416-1416, down from $1.1421-1421, and at ¥129.34-34, up from ¥129.20-21.

The dollar was firmer around ¥113.40 in early trading thanks to a rise in U.S. long-term interest rates.

The dollar topped ¥113.50 at one point, also aided by demand from Japanese importers for settlement purposes and a rise in Tokyo stock prices.

“The dollar drew purchases from real demand-backed players in Japan ahead of the three-day weekend through Monday,” a Japanese bank official said. There will be no trading in the Tokyo market on Monday for a national holiday.

In late hours, the dollar briefly slipped below ¥113.20 in response to a drop in U.S. long-term interest rates, market sources said.

A wait-and-see mood grew later ahead of the release of U.S. economic data, including the consumer price index and retail sales, both for June, market sources said.

If the CPI report shows slowing price growth in the United States, the dollar is expected to face selling on speculation that the pace of interest rate increases by the U.S. Federal Reserve will stay moderate, an official at a foreign exchange margin trading service firm said.