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The dollar rebounded to around ¥108.40 after slipping through the ¥108 threshold in Tokyo trading Tuesday.

At 5 p.m., the dollar stood at ¥108.39, up from ¥108.22 at the same time Monday. The euro was at $1.2068, up from $1.2017, and at ¥130.82, up from ¥130.06.

The dollar dived below ¥108 yen for the first time in some 1½ months in the wake of the 225-issue Nikkei average’s free-fall right after the market opening.

But the greenback recouped the early losses to return to ¥108 terrain in midmorning trading thanks to active purchasing by Japanese importers for settlement purposes and a rise in U.S. long-term interest rates.

After coming under renewed selling pressure, the dollar briefly topped ¥108.40 in later afternoon trading aided by higher crude oil prices and U.S. interest rates.

Despite growing risk-averse sentiment reflecting uncertainties over the direction of the U.S.-China relationship and the resurgence of the coronavirus, the yen, deemed as a safe-haven currency, became broadly weaker while the dollar regained firmness, market players said.

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