The dollar dropped below ¥109.70 in Tokyo trading Wednesday as the yen attracted purchases against major currencies.
At 5 p.m., the dollar stood at ¥109.65-66, down from ¥109.86-86 at the same time on Tuesday. The euro was at $1.1389-1389, down from $1.1424-1424, and at ¥124.89-89, down from ¥125.50-50.
The dollar moved between ¥109.90 and ¥110 in early trading as a wait-and-see mood spread ahead of U.S. President Donald Trump’s State of the Union address.
When the Nikkei stock average added to gains around midmorning, the dollar topped ¥110. But the greenback soon took a sharp downturn in thin trading reflecting the closure of Chinese markets for the weeklong Luna New Year holiday, sinking below ¥109.70.
Selling of the U.S. currency took the upper hand following the yen’s appreciation against the Australian dollar prompted by Reserve Bank of Australia Gov. Philip Lowe’s remarks suggesting a rate cut possibility, traders said.
The dollar temporarily showed resilience but returned to levels below ¥109.70 in late trading, dampened by the euro’s decline versus the yen on selling sparked by the release of weaker-than-expected new manufacturing orders in Germany, a currency broker said.
Trump’s speech, which ended past noon Japan time, had little impact on the dollar-yen pair, an official at a major Japanese bank said.