The dollar strengthened to around ¥109.15 in Tokyo trading Wednesday, as hopes for progress in U.S.-China trade talks increased.

At 5 p.m., the dollar stood at ¥109.18-18, up from ¥108.95-95 at the same time Tuesday. The euro was at $1.1007-1007, down from $1.1015-1015, and at ¥120.19-19, up from ¥120.01-02.

The dollar lost minor ground in the early morning after firming above ¥109.10 in overnight trading amid growing expectations of the United States and China reaching a preliminary trade deal in the near future. But the U.S. currency recouped the loss thanks to buying for month-end settlement purposes by Japanese importers.

The dollar crept up in the afternoon despite a dearth of fresh trading incentives.

“The dollar is failing to stage a powerful advance because investors are buying the greenback only in anticipation of progress in the U.S.-China trade talks,” an insurance firm official said.

“The dollar-yen pair can hardly go up in step with stocks as long as investors are wondering whether the global economy will get better,” a Japanese bank official said.

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