The dollar was stationary in the 109.50 yen area in calm trading in Tokyo on Thursday, with investors stepping aside ahead of major overseas events.
At 17:00, the dollar was trading at 109.54 yen, up from 109.45 yen on Wednesday. The euro was worth $ 1.2160 versus $ 1.2183 and 133.21 yen versus 133.34 yen.
After the dollar surged above 109.60 yen in early trading, the dollar fell to about 109.50 yen in mid-morning on sales boosted by the strengthening of the Chinese yuan against the US dollar, reflecting media reports that US trade ministers and China agreed to develop cooperation in trade and investment.
The US currency then fluctuated in a narrow range amid a wait-and-see attitude ahead of the US CPI for May and the European Central Bank’s policy meeting later in the day.
At the end of trading, the dollar strengthened slightly on the back of sales of the euro, with the position adjusted ahead of the ECB meeting and a moderate rise in the yield of long-term US Treasury bonds outside business hours.
Market participants are increasingly wary of the potential for volatility in the foreign exchange market as the CPI publication and ECB President Christine Lagarde’s press conference after the policy meeting are scheduled to take place at the same time. the firm said.
The May CPI is being watched closely as a predictor of when the US Federal Reserve will begin discussions about reducing its quantitative easing.
Meanwhile, some say the dollar is expected to meet selling when it rallies to 110 yen, but is likely to gain support from buying in the around 109 yen downturn.
“The dollar will need a significant amount of energy to get out of the current range of 109-110 yen,” said the foreign exchange broker.
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