The dollar dropped to around ¥107.70 in Tokyo trading Thursday, pressured by a fall in Japanese stock prices.
At 5 p.m., the dollar stood at ¥107.76-76, down from ¥108.26-26 at the same time Wednesday. The euro was at $1.1239-1239, up from $1.1206-1207, and at ¥121.11-12, down from ¥121.32-33.
Japan’s key Nikkei stock average at first dropped after seeing the dollar fall against the yen and the dollar then faced risk-off selling in response to the Nikkei’s fall, dealers said. “It was like looking at two mirrors held against each other,” an official at a Japanese asset management company said.
But market players agreed that the dollar is unlikely to fall further against the yen.
“The dollar is still in a familiar range and next action will come after the U.S. Federal Reserve’s monetary policy meeting later this month,” an official at a Japanese bank said.
“I don’t think that factors strong enough to change the trend (of the dollar-yen pair) have emerged,” an official at a bank-affiliated securities house said.
The dollar “seems like being oversold,” the asset management company official said, referring to Thursday’s slide in the currency.