12 October 2001, 13:04 Dollar firm against yen in Tokyo, hijacking reports dismissed
TOKYO, Oct. 12 (Kyodo) - By: Yoshino Matsui The U.S. dollar
remained bullish against the Japanese yen Friday in Tokyo,
continuing an overnight trend overseas as players showed a muted
response to a hijacking report from Nagoya that later turned out to
be a false alarm.
At 5 p.m., the dollar was quoted at 121.32-35 yen, almost
unchanged from Thursday's 5 p.m. quote of 121.45-55 yen in New
York. But the dollar jumped nearly 1 yen from the 120.38-41 yen
level marked in Tokyo late Thursday.
During the day, the dollar moved between 121.20 yen and 121.54
yen, trading most frequently at 121.33 yen. The U.S. currency
surpassed 121.50 yen for the first time in Tokyo since last month's
terror attacks.
At 5 p.m., the euro traded at $0.9030-9033 and 109.57-61 yen
compared with $0.9020-9030 and 109.60-70 yen at 5 p.m. Thursday in
New York.
Early in the afternoon, Nagoya airport authorities received a
call warning that a Taliban-linked group would hijack a Northwest
Airlines flight.
But reports of the possible hijacking did not spur selling of
the dollar, because as one dealer explained, "The market will not
react instantly to such reports because there have been many
unclear reports on terrorism recently."
Police later said they believe the incident was a prank call and
launched an investigation into the case.
Also in the afternoon, Finance Minister Masajuro Shiokawa said
in the Diet he told Prime Minister Junichiro Koizumi and Heizo
Takenaka, minister in charge of economic and fiscal policy, in a
meeting Wednesday night that, "It may be better for the yen to be
somewhat weaker than now."
The remark, broadcast live on television, briefly pushed the
dollar up by 0.15-0.20 yen, dealers said.
Tokyo and New York took over the dollar-bullish sentiment from
London, where the dollar shot up against the yen Thursday on
buybacks believed to have been made by U.S. hedge funds, dealers
said.
Thursday's hefty gains on Wall Street also supported the dollar.
The Nasdaq composite index jumped 4.62% to 1,701.47, returning to
its pre-Sept. 11 level and stirring expectations of an economic
recovery in the U.S. The Nasdaq index closed at 1,695.38 on Sept.
10.
Takayuki Togawa, a manager at Tokai Bank, attributed the firm
performance on Wall Street to "a nascent belief that the air raid
(in Afghanistan) is going to end soon."
The United States bombed Afghanistan's ruling Taliban for the
fifth straight day Thursday in retaliation for the Sept. 11 terror
attacks on New York and Washington.
Joseph Kraft, foreign exchange head at Morgan Stanley Japan
Ltd., said speculations that the U.S. government will adopt a
fiscal stimulus package of around $200 billion to cushion negative
impacts on the economy from the terror attacks also gave support to
the dollar.
"If it is true, it would be the largest fiscal stimulus since
World War II," he said.
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