Dollar Continues Slide, Stocks Also Decline
TOKYO (AP) _ The dollar lost more ground today against the Japanese yen in Tokyo, where stock prices also fell in volatile trading.
The dollar closed at 137.65 yen, down 0.65 yen from Wednesday’s finish. It opened lower at 137.40 yen and ranged between 137.15 yen and 138.10 yen.
On the Tokyo Stock Exchange, the 225-share Nikkei Stock Average fell 141.06 points, or 0.56 percent, ending the day at 25,075.08. The key index rose nearly 200 points by mid-afternoon before falling back when arbitrage sellers took profits on differences between the spot and futures markets, traders said.
On Wednesday, the Nikkei index rose 611.48 points.
Masashi Wakabayashi, a trader with Yamaichi Securities Co., said today’s decline was mainly due to intermittent arbitrage selling related to the expiration of September futures trading today.
In currency dealings, the dollar closed lower after nervous fluctuations involving mainly the yen and European currencies, said Masato Hayashi of the Bank of Tokyo.
″The yen is currently stronger than other major currencies, partly because of the general expectation of another discount rate increase,″ he said.
The Bank of Japan raised the nation’s official lending rate to commercial banks on Aug. 30 from 5.25 percent to 6 percent, but the market believes the nation’s economy requires even tighter policy, Hayashi said.
The dollar has become less attractive because of pessimism over a slowdown in the U.S. economy, he said.
In bond dealings, the yield of benchmark No. 119 10-year Japanese government bonds closed at 8.385 percent, up from 8.260 percent Wednesday. Their price fell to 81.93 from 82.45.