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The dollar weakened to around ¥108.70 in Tokyo trading Wednesday, pressured by position-squaring selling.

At 5 p.m., the dollar stood at ¥108.72, down from ¥108.81 at the same time Tuesday. The euro was at $1.1883, up from $1.1879, and at ¥129.20, down from ¥129.26.

After fluctuating around ¥108.60, the dollar climbed to top ¥108.80 by noon in response to a rise in U.S. long-term interest rates in off-hours trading.

In the afternoon, the greenback lost steam as players put active trading on hold ahead of a 10-year Treasury note auction and the release of the consumer price index for February in the United States later on Wednesday.

Some players moved to square dollar-long positions in late afternoon trading before the auction, traders said, adding that caution over the high level of the dollar against the yen also led to selling of the U.S. currency.

Pointing out that a 30-year Treasury bond auction will also be held, in the small hours of Thursday Japan time, a Japanese bank official warned that U.S. interest rates may show unstable movements.

The official also said that the European Central Bank’s policy meeting Thursday drew investor attention as well.

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