Dollar Hits 2-Month Low below 154 Yen in Tokyo

Tokyo, Jan. 26 (Jiji Press)–The dollar fell below 154 yen in Tokyo trading Monday morning to hit its lowest level in about two and a half months, amid speculation about a possible coordinated yen-buying intervention by Japanese and U.S. authorities. Later, the greenback slightly pared its losses to stand at 154.11-11 yen at 3 p.m., still down from 158.38-38 yen at 5 p.m. Friday. On Friday, the dollar slumped versus the yen in Tokyo temporarily, as market players speculated that the Bank of Japan had conducted so-called rate checks to ask financial institutions about exchange rate levels. Such actions sometimes preceded currency market interventions. In overseas trading later Friday, the U.S. currency slid further to levels below 156 yen after a report that U.S. financial authorities also carried out rate checks. An official at a foreign financial institution told Jiji Press that the U.S. Federal Reserve Board conducted a rate check on the institution. “Caution over a Japan-U.S. coordinated intervention spread” across the market, a foreign exchange broker said, explaining the major reason for Monday’s further fall in the dollar against the yen. On Monday, Japanese Finance Minister Satsuki Katayama said that she has “nothing to say” about rate checks. On the Tokyo Stock Exchange, selling hit a wide range of issues amid the yen’s surge against the dollar. The benchmark Nikkei index of 225 select issues listed on the TSE’s Prime section finished at 52,885.25, down 961.62, or 1.78 pct, from Friday. Automakers and others succumbed to selling due to concerns over potential impacts on corporate earnings from the yen’s rise. Banks also fared poorly. “The yen’s appreciation was a good excuse to sell to lock in profits because the stock market was seen as overheating following its ascent from the beginning of the year,” an official of a major securities house said. END [Copyright The Jiji Press, Ltd.]