The dollar recouped early losses to trade around ¥106.60 in Tokyo late Monday, attracting buybacks after Finance Minister Taro Aso signaled his intention not to step down over an alleged favoritism scandal involving a sale of state land.
At 5 p.m., the dollar stood at ¥106.56-56, still down from ¥106.68-68 at the same time Friday. The euro was at $1.2337-2337, up from $1.2318-2318, and at ¥131.47-47, up slightly from ¥131.43-43.
“The dollar was hit by selling in early trading due to political uncertainty stemming from the scandal and worries over U.S. trade protectionism,” an official at a currency brokerage house said.
News that the ruling Liberal Democratic Party was briefed by a government official that some documents related to the land deal had been altered “raised uncertainty over whether the Abenomics economic policy will continue,” an official at a foreign exchange margin trading service firm said.
The dollar dropped below ¥106.40 in the afternoon, but rose back above ¥106.60 later.
“Market participants had been concerned that Aso would resign over the scandal, but such excessive concerns subsided following his comments,” an official at a foreign exchange brokerage house said.