The dollar slipped below ¥120 in Tokyo trading on Tuesday, pressured by selling by investors who were disappointed by the Bank of Japan’s decision to leave its monetary policy unchanged.
At 5 p.m., the dollar stood at ¥119.59-60, down from ¥120.16-16 at the same time Monday. The euro was at $1.1307-1307, down from $1.1336-1337, and at ¥135.22-24, down from ¥136.21-24.
The dollar was firmer around ¥120.30 in early trading, carrying over its solid tone from overnight trading overseas, where the greenback attracted buybacks.
The dollar briefly topped ¥120.60 in midmorning trading as Tokyo stocks extended gains.
“Investors who expected additional monetary easing by the BOJ at its two-day monetary policy meeting through Tuesday moved to buy stocks and dollars in advance,” an official at a foreign exchange margin trading service firm said.
The dollar came under selling pressure as Tokyo stocks grew top-heavy.
The U.S. currency later slipped below ¥120 after the BOJ decided to keep its monetary policy unchanged.
“The dollar was hit by selling by investors who had expected further monetary easing steps by the BOJ,” one market source said.
The dollar extended losses further and fell to around ¥119.55 in late hours as BOJ Governor Haruhiko Kuroda did not suggest clues for possible additional monetary easing at a news conference held after the central bank’s Policy Board meeting, market sources said.