Dollar Slips, Stocks Rise
TOKYO (AP) _ The dollar slipped against the Japanese yen today despite dollar-buying by the Bank of Japan on the eve of a meeting of key financial officials from the seven major industrial nations.
Share prices rose on the Tokyo Stock Exchange.
By late afternoon, the dollar was trading at 100.28 yen, down 0.24 yen from late Thursday.
Traders said the Bank of Japan aggressively bought dollars during the morning session, when the U.S. currency was trading at around 99.80 yen.
The Bank of Japan does not comment on its intervention activities.
Traders said the central bank action was apparently intended to keep the dollar above the 100-yen level ahead of the Group of Seven finance meeting Saturday in Washington.
Masakazu Kodama, a dealer with Sanwa Bank, said many players do not expect anything special in steps to support the American currency from the weekend meeting.
Japanese Finance Minister Masayoshi Takemura, who was to leave for Washington today, said he would explain measures to address non-performing loans held by Japanese financial institutions.
The bad loan problem has left many overseas investors skeptical about the health of Japan’s financial system.
Japanese financial institutions have at least $400 billion in non-performing loans to deal with, many related to soured real estate deals. Critics say the actual bad debts could be twice that amount.
Real estate and stock prices in Japan have tumbled in four years of economic stagnation.
Most traders spend much of today squaring their dollar positions prior to the meeting among the finance officials of the United States, Japan, Germany, Britain, France, Italy and Canada.
Meanwhile, the 225-issue Nikkei Stock Average rose 285.87 points, or 1.57 percent, closing the week at 18,506.28. On Thursday, the index had gained 75.33 points, or 0.42 percent.
An estimated 370 million shares changed hands on the first section, up from Thursday’s 263 million shares. Advancing issues outnumbered decliners 770 to 264, with 167 issues unchanged.
The Tokyo Stock Price Index of all issues listed on the first section was up 11.98 points, or 0.82 percent, to 1,468.31. The TOPIX gained 4.34 points, or 0.30 percent, to 1,456.33 the day before.
The benchmark No. 174 10-year Japanese government bonds closed at 113.41 yen, down 0.57 yen from Thursday’s close. Their yield rose to 2.730 percent from 2.660 percent.