The dollar was almost flat around ¥108.30 in Tokyo trading late Thursday after overcoming its early weakness.
At 5 p.m., the dollar stood at ¥108.34-35, against ¥108.31 at the same time Wednesday. The euro was at $1.1294, down from $1.339-1340, and at ¥122.37, down from ¥122.82.
After moving around ¥108.40 in early trading, the dollar fell below ¥108.20 in midmorning trading as the Australian dollar dropped against the yen amid growing speculation over an interest cut by the Australian central bank.
The speculation spread as the Australian government’s jobs data for May showed only a slight increase in the number of full-time workers, an official of a foreign exchange margin trading service firm said.
The greenback was also pressured by falls in Japan’s benchmark 225-issue Nikkei average and Hong Kong stocks.
After the selling ran its course, the U.S. currency bounced back above ¥108.30 in afternoon trading.
Market players “found it difficult to move in the absence of major incentives in the afternoon,” an official of a Japanese bank said, indicating that their attention is increasingly paid to U.S. and Chinese retail sales data for May, to be released Friday.
Players are also keeping a close tab on whether the outcome of the U.S. Federal Reserve’s two-day Federal Open Market Committee meeting next week will hint at an interest cut at an FOMC meeting in July, traders said.
But the foreign exchange margin trading service firm official said that “the market has factored in a Fed interest rate cut too much.” The dollar is expected to attract buybacks if the FOMC meeting results fail to meet market expectations, the official added.