The dollar weakened below ¥106.50 in Tokyo trading Monday due in part to safe-haven buying of the yen.
At 5 p.m., the dollar stood at ¥106.48-48, down from ¥106.75-75 at the same time Friday. The euro was at $1.1853-1854, up from $1.1801-1801, and at ¥126.22-23, up from ¥125.97-98.
The dollar recovered to around ¥106.60 in early morning trading after falling below ¥106.50 abroad over the weekend on selling prompted by the release of gloomy U.S. retail sales data on Friday.
But later in the morning the greenback came under selling pressure generated by the Nikkei stock average’s downturn and growing fears about the potential collapse of the “phase one” trade deal between the United States and China.
In the afternoon, the dollar temporarily fell into a range sandwiching ¥106.40 after going sideways around ¥106.50, reflecting a drop in U.S. long-term interest rates in off-hours trading.
“Some investors bought the yen as a safe-haven currency versus the dollar after the Japanese government announced earlier in the day a postwar record-matching drop in Japan’s gross domestic product for April-June,” said an official at a bank-affiliated securities firm.
“Prime Minister Shinzo Abe’s hospitalization for a checkup provided short-term players with an incentive to buy the yen,” another brokerage house official said.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.