The dollar recouped early losses to scale around ¥108.40 in Tokyo trading Wednesday.
At 5 p.m., the dollar stood at ¥108.41-41, up from ¥108.33-33 at the same time Tuesday. The euro was at $1.1152-1152, down from $1.1174-1174, and at ¥120.90-91, down from ¥121.03-03.
The dollar tumbled below ¥107.70 in the morning, in response to news reports that military bases housing U.S. troops in Iraq were attacked by ballistic missiles fired by Iran.
But the greenback soon saw a turnaround as fears about an escalation in U.S.-Iran tensions were eased by Iranian Foreign Minister Javad Zarif’s Twitter post denying the country intends to wage war, traders said.
“The dollar was quickly bought back,” said a currency broker.
After retaking ¥108.40, the dollar went sideways in quiet trading.