Dollar falls to ¥113.50 as stocks recoil from Nikkei surge


The dollar fell to levels around ¥113.50 in Tokyo trading on Thursday, dampened by a steep fallback from the previous day’s surge in Japanese stocks.

At 5 p.m., the dollar stood at ¥113.51-52, down from ¥113.82-83 at the same time Wednesday. The euro was at $1.1604-1605, up from $1.1593-1594, and at ¥131.73-73, down from ¥131.99-99.

In the morning, the dollar advanced to around ¥114 as the 225-issue Nikkei stock average shot up more than 450 points to rewrite a 26-year high on the Tokyo Stock Exchange. The U.S. unit was also supported by Japanese importers’ purchases, traders said.

But the dollar lost steam after the Nikkei took a downturn in the afternoon. The greenback fell below ¥113.50 on selling triggered by the Nikkei’s nearly 400-point plunge.

The abrupt pullback in stocks initially led to “only limited selling” of the dollar, but “as the market’s loss widened, the U.S. unit’s fall became faster,” a currency broker said.

The dollar later recouped lost ground, although its recovery was not as fast as the Nikkei’s, traders said.

Investors’ risk appetite declined after the stock sell-off in the afternoon, an official at a foreign-exchange margin trading service firm said.

Besides stock prices, players are closely watching developments associated with U.S. tax reform and long-term U.S. Treasury yields, an official at a bank-affiliated securities firm said.

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