Business / Financial Markets | CURRENCY MARKET

Dollar weakens to around ¥110.50 in Tokyo after whipsawed by Nikkei and U.S. stimulus

JIJI

The dollar fell to around ¥110.50 in Tokyo trading Thursday after a late bout of selling slowed its run.

At 5 p.m., the dollar stood at ¥110.46-47, down from ¥111.46-46 at the same time Wednesday. The euro was at $1.0925-0925, up from $1.0807-0807, and at ¥120.68-69, up from ¥120.46-47.

Succumbing to position-adjustment selling by exporters and selling triggered by a plunge in the benchmark 225-issue Nikkei stock average, the dollar dropped below ¥110.50 in morning trading.

The greenback then rose above ¥110.80 in the afternoon after the U.S. Senate’s passage of a $2.2 trillion economic stimulus package to battle the increasing damage caused by the pandemic.

In late trading, the U.S. currency fell to around ¥110.50 due to heightened selling pressure.

An official at a trust bank noted that some market participants became risk-averse, reacting negatively to the growing number of infections in Tokyo and other parts of Japan.

“If an explosive increase of coronavirus infections or a lockdown of Tokyo were to occur, it is more likely that the yen will be sold, rather than bought, amid a risk-averse mood,” an official at a foreign-exchange margin trading service firm said.

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