Dollar falls below ¥105.50 in Tokyo amid trade war worries

JIJI

The dollar fell below ¥105.50 in Tokyo trading Monday, amid increasing worries about a global trade war: U.S. President Donald Trump is expected to sign an order this week to impose tariffs on imported steel and aluminum products despite the outcries of U.S. trading partners.

At 5 p.m., the dollar stood at ¥105.39-39, down from ¥105.73-74 at the same time Friday. The euro was at $1.2283-2285, up from $1.2263-2263, and at ¥129.47-47, down from ¥129.66-67.

The dollar’s topside versus the yen “continued to be pressured” by Trump’s tariff announcement last week, as well as Bank of Japan Gov. Haruhiko Kuroda’s remarks, also last week, that the central bank will certainly be considering how to exit its massive monetary easing campaign in the near future, said an official at a major Japanese bank.

In New York trading on Friday, the greenback hit 16-month lows below ¥105.30 after Trump tweeted that trade wars are “good” and “easy to win,” in response to the European Union’s threat of countermeasures against the U.S. protectionist policy.

In Tokyo on Monday the dollar rallied to near ¥105.70 in the morning, supported by Japanese importers’ buying, traders said.

But the U.S. currency met with renewed selling in late trading, slipping below ¥105.50 again.

The euro’s drop reflects growing uncertainties over the course of Italian politics after a general election in the major European country also induced buying of the yen vis-a-vis the dollar, a Japanese bank official said.