The dollar firmed to around ¥109.80 in Tokyo trading Friday, aided by the Bank of Japan’s move to curb a rise in the country’s long-term interest rates and buying to cover short positions.
At 5 p.m., the dollar stood at ¥109.77, up from ¥109.59 at the same time Thursday. The euro was at $1.2508, up from $1.2403, and at ¥137.31, up from ¥135.92.
The dollar was moving around ¥109.40 in early trading. But it scaled to top ¥109.60 after the BOJ offered to buy an unlimited amount of Japanese government bonds with remaining maturities of over five years to 10 years at a fixed rate of 0.11 percent.
“Speculation about the central bank’s tapering has receded to some extent” since the unlimited bond-buying offer, made for the first time in some seven months, a think tank analyst said.
Although the dollar fell back as the Nikkei stock average expanded its loss later in the morning, the greenback recovered close to ¥109.70 on short-covering buying toward noon.
In late hours, the dollar fluctuated narrowly around ¥109.70, with investors retreating to the sidelines before the release of the U.S. jobs data for January, market sources said.