The dollar was almost unchanged around ¥111.80 in Tokyo trading late Thursday after its early gains were erased by selling on a rally.
At 5 p.m., the dollar stood at ¥111.83-83, against ¥111.81-81 the same time Wednesday. The euro was at $1.1154-1154, down from $1.1216-1216, and at ¥124.82-83, down from ¥125.41-43.
The dollar briefly rose to around ¥112.20 on a rise in the benchmark Nikkei stock average. But the currency was later pressured by selling to square positions ahead of a meeting between Finance Minister Taro Aso and U.S. Treasury Secretary Steven Mnuchin later on Thursday, an official of a bank-linked securities firm said.
“There was a sense of caution among market players against the possibility that Aso and Mnuchin will discuss a currency clause,” an official at a foreign exchange trading service firm said, referring to a proposed provision under a potential Japan-U.S. trade agreement designed to prevent competitive currency devaluations.
Market players reacted little to the Bank of Japan’s decision to keep both short- and long-term interest rates extremely low until at least spring 2020 and a news conference by BOJ Gov. Haruhiko Kuroda.
The BOJ’s decision “had only a limited impact” on currency trading, the foreign exchange trading service firm official said. Kuroda’s press conference “gave no incentives,” an official of an asset management firm said.