The dollar was firmer around ¥112.50 in Tokyo trading late Thursday, backed by a rebound in Japanese stock prices, but traders remained cautious about chasing the dollar higher amid worries about the situation in the Middle East.
At 5 p.m., the dollar stood at ¥112.54-55, up from ¥112.09-10 at the same time on Wednesday. The euro was at $1.1795-1795, down from $1.1824-1824, and at ¥132.74-75, up from ¥132.54-55.
The greenback’s rally was relatively moderate compared with the benchmark 225-issue Nikkei stock average’s sharp rebound from a plunge the previous day caused by news about U.S. President Donald Trump’s plans to officially recognize Jerusalem as the capital of Israel, traders said.
“There’s a persistent sense of vigilance over the Middle Eastern situation” after Trump announced the decision overnight, an official at a foreign-exchange brokerage house said.
Active trading was also held in check ahead of the release Friday of U.S. jobs data for November.
Bank of Japan Gov. Haruhiko Kuroda suggested in a speech Thursday that the BOJ is carefully watching for side effects from its monetary easing policy. No major reaction was seen in the currency market.