The dollar firmed above ¥109.70 in Tokyo trading Thursday, supported by solid performances of Asian stocks.
At 5 p.m. the dollar stood at ¥109.71-75, up from ¥109.61-62 at the same time Wednesday. The euro was at $1.1367-1368, slightly up from $1.1364, and at ¥124.74, up from ¥124.57-58.
After rising around ¥110 in overnight trading amid revived hopes for progress in U.S.-China trade negotiations, the dollar lost ground to levels near ¥109.40 on reselling in the early morning. Although the U.S. currency briefly retook ¥109.60, it fell back below ¥109.50 later in line with the Nikkei stock average’s retreat.
In the afternoon, the greenback regained strength as the Nikkei trimmed its early losses and stocks in other Asian markets fared well, traders said.
The dollar was stuck in a narrow band between ¥109.60 and ¥109.70 in late hours, as a wait-and-see mood spread ahead of the European Central Bank’s Governing Council meeting and a subsequent news conference by ECB President Mario Draghi, they said.
Chances are slim that the ECB chief will make “dovish” comments. “But if the surprise occurs, it would affect the dollar-yen pair,” said an official at a Japanese bank.
After the ECB policy meeting, market attention will shift to next week’s Federal Open Market Committee meeting of the U.S. Federal Reserve and ministerial-level trade talks between the United States and China, an official at a bank-linked securities firm said.