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Dollar stronger above ¥110.60 in late Tokyo trading

JIJI

The dollar was firmer above ¥110.60 in Tokyo trading late Wednesday, backed by expectations that the U.S. Federal Reserve will raise interest rates.

At 5 p.m., the dollar stood at ¥110.62-63, up from ¥110.32-32 at the same time on Tuesday. The euro was at $1.1745-1749, down from $1.1793-1794, and at ¥129.94-95, down from ¥130.10-11.

The dollar got a boost from purchases by Japanese importers, a rise in long-term U.S. interest rates and higher Japanese stocks, traders said.

The dollar rose against the yen to levels that factor in a possible Fed decision to raise interest rates before being sold to lock in profits, dealers said.

There has been speculation that the Fed will signal a faster pace of interest rate increases when it announces a policy decision later on Wednesday, traders said.

“Sentiment remains in favor of the dollar against the yen,” an official of a major securities firm said after the late bout of profit-taking.

Tuesday’s U.S.-North Korea summit was “taken as a positive development” because the meeting proceeded smoothly, an official at a major Japanese bank said.