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Dollar dragged down by slides in Japanese stocks, falls below ¥111 in Tokyo

JIJI

The dollar fell below ¥111 in Tokyo trading late Wednesday, dragged down by slides in Japanese and Chinese stocks.

At 5 p.m., the dollar stood at ¥110.94-94, down from ¥111.35-35 at the same time on Tuesday. The euro was at $1.1610-1610, up from $1.1576-1578, and at ¥128.80-81, down from ¥128.90-93.

The greenback started falling when the benchmark Nikkei stock average sank into negative territory in the afternoon, dealers said.

Weakness of Japanese and Chinese stocks “gave an impetus to safe-haven buying of the yen,” an official at a foreign exchange broker said.

“Stop-loss sales added to downward pressure on the dollar after it slipped below ¥111,” an official of a bank-linked securities firm said.

The dollar’s fall also reflected a cautious stance among market players ahead of the launch in Washington on Thursday of new ministerial trade talks between Japan and the United States, traders said.

“The dollar’s underlying tone is strong given a strong U.S. economy, but market players face difficulty bidding up the currency ahead of the start of the new trade talks,” an official at a foreign-affiliated securities firm said.

The dollar may fall to around ¥110.75 in the days to come, traders said.