Nov. 02, 1987
TOKYO (AP) _ Despite quick intervention by the Bank of Japan to bolster the U.S. currency, the dollar slipped toward record low levels against the Japanese yen in early trading Monday.
The U.S. dollar opened at 137.70 yen on the Tokyo Foreign Exchange Market, down nearly 1 yen from Friday's close of 138.55 yen, and dropped to 137.35 yen after 9:30 a.m.
That fall cut short the dollar's rebound Friday, when the currency gained from its closing Thursday of 137.55 , its lowest in four decades.
''Nothing has changed,'' said Alan Yamashita, foreign exchange manager of Goldman Sachs Corp. in Tokyo. ''The dollar will be under pressure for the rest of the week.''
He attributed bearish attitudes in Tokyo mainly to ''concern that the United States will not be able to cut its budget deficit,'' a low closing by the dollar Friday in New York, and to remarks by West German officials who indicated an orderly decline of the dollar was more or less acceptable.
Yamashita also said sentiment that major industrial nations do not ''see eye to eye'' on currency stabilization weakened the dollar.
The Bank of Japan stepped in shortly after the market opened and pushed the dollar up to a high of 137.85 yen, market dealers said.
But the impact of the intervention fizzled in the face of commercial selling from exporters combined with selling by dealers who wanted to increase their short positions, they said.
By 9:30 a.m., the Bank of Japan was estimated to have purchased some $200 million to boost the U.S. currency, one report said. The bank does not comment on its intervention.
At 9:35 a.m., the U.S. currency was quoted at 137.38 yen, down from the Tokyo opening and from the 138.35 yen quoted in late New York trading Friday.
It was also lower than its 137.55 close Thursday, its lowest since the modern exchange rate system was created in the late 1940s. The dollar had climbed to 147.20 yen as recently as Oct. 5.