Dollar wipes out gains to move around ¥ 108.70 by Tokyo end

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The dollar dropped previous gains to move around ¥ 108.70 in Tokyo on Monday night.

At 5 p.m., the dollar was up to ¥ 108.75, compared to ¥ 108.69 at the same time on Friday. The euro was at $ 1.2197, down from $ 1.2216, and ¥ 132.64, down from ¥ 132.79.

The dollar traded around ¥ 109.00 in foreign trade on Friday on a better-than-expected US purchasing managers index for May released by UK financial data provider IHS Markit.

The greenback narrowly moved in morning trading in Tokyo, supported by purchases from Japanese importers for settlement, but capped by safe sales.

A fall in US long-term interest rates outside of business hours led to the dollar selling off in the afternoon against many major currencies.

The effects of a rise in the euro and the pound against the dollar pushed the greenback even lower against the yen at the end of the session.

As hopes of a US economic recovery soar thanks to advances in COVID-19 vaccination, investors are “watching closely when the US Federal Reserve begins to consider reducing quantitative monetary easing.” said an official at a Japanese bank.

A currency broker noted that volatile movements in cryptocurrencies such as bitcoin “chill investor sentiment.”

An official at a foreign exchange margin trading services company said the currency market is expected to be influenced by U.S. interest rates, stock and commodity prices, and economic indicators.

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