The dollar was lower below ¥109.10 in Tokyo trading late Monday amid mounting worries over pneumonia caused by a new strain of coronavirus.

At 5 p.m., the dollar stood at ¥109.05-05, down from ¥109.54-54 at the same time Friday. The euro was at $1.1034-1034, down from $1.1049-1052, and at ¥120.34-34, down from ¥121.06-06.

The dollar fell to levels close to ¥108.70 in the early morning, the lowest level in some three weeks, as a risk-averse mood grew due to the spread of the new pneumonia.

After the dollar selling ran its course, the greenback temporarily rose above ¥109.10 in the afternoon, thanks to a halt in plunging prices in the Nikkei 225 average and real demand-backed dollar buying.

The dollar became almost static later in the afternoon, amid a dearth of fresh trading incentives.

“How far the pneumonia spreads will be the key” for the currency market, an official of a foreign exchange margin trading service firm said.

“The dollar may rebound against the yen if the spread (of the pneumonia) ends in a short period, but investors will have no choice but to pay attention to downside risks (for the dollar) this week,” a currency broker said.

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