The dollar rose above ¥111.40 in late Tokyo trading Tuesday, jacked up by higher U.S. long-term interest rates.
At 5 p.m., the dollar stood at ¥111.45-45, up from ¥110.96-97 at the same time Monday. The euro was at $1.1569-1569, down from $1.1610-1611, and at ¥128.94-95, up from ¥128.84-85.
Amid a dearth of trading factors following the closure of the U.S. market for the Labor Day holiday on Monday, the dollar moved narrowly around ¥111 in early trading, traders said.
The greenback fell close to ¥110.90 as the 225-issue Nikkei stock average turned lower soon after the opening bell.
The U.S. currency then rose back to around ¥111.10 on purchases by domestic importers and stayed around the level for a while, according to the traders.
In late trading, the dollar added gains to climb above ¥111.40 thanks to a rise in U.S. long-term interest rates in off-hours trading, the traders said.
Market players “snapped up dollars as their risk appetite increased” on higher long-term interest rates and stock index futures in the United States, a trust bank official said.
Traders also cited yen selling to hunt the currencies of emerging economies as a dollar-positive development.
Emerging-economy currencies drew purchases thanks to the Turkish lira’s relatively stable movements and the Australian central bank’s decision to keep its policy rate on hold despite concerns about the country’s economy, the traders said.
However, the trust bank official said, “Sell orders are likely to increase as the dollar reaches ¥111.50.”
The U.S. currency “is unlikely to top ¥112 unless trade friction between the United States and other countries eases,” the official added.