U.S. dollar sinks to global low against yen in Tokyo

TOKYO (UPI): The U.S. dollar spun to record low intraday and closing rates here yesterday despite repeated Bank of Japan intervention, and exchange dealers forecast more woes for the ailing currency.

The greenback ended at a global closing low of 96.68 yen, off 0.42 yen from its late rate in New York on Thursday and down 0.95 yen from its previous Tokyo close.

Spot volume was a heavy $8.8 billion, compared to Thursday's $6.03 billion.

The currency's fresh dive began in New York late Thursday after U.S. Treasury Secretary Llyod Bensten said Washington had no plans to halt a spate of dollar weakness with market intervention.

After trading around 97.10 yen late in New York, the dollar plunged when Tokyo trading opened yesterday. It slipped as far as 96.55 yen -- a new global intraday low -- before being rescued by Bank of Japan intervention. The previous intraday low was 96.65 yen set in July in New York and London.

Tokyo's Ministry of Finance and its Economic Planning Agency reiterated sharp concern over the dollar's fall against the yen yesterday, saying it could harm Japan's economic recovery. Chief Cabinet Secretary Kozo Iagarashi called the move short term and said it was driven by speculators.

"We believe the exchange rate will reflect the economic fundamentals and move in a stable manner," he told reporters. Tokyo dealers disagreed, saying while there were increasing signs of U.S. economic strength there were few incentives for investors to buy dollars.

"The target at present will be 96.40 yen where a lot of stop- loss selling orders are said to lie," said Yuko Fukakusa, a currency exchange manager at Tokai Bank. "If the dollar breaks through there, a fall to the 95-yen level will be quite likely very soon."

A weaker dollar hurts Japan's export-focused businesses by making their products more expensive for consumers overseas.

Several business leaders in Japan have warned continued dollar weakness against the yen could douse growing signs of Tokyo(s recovery from more than three years of severe recession.

Europe

In Frankfurt, the dollar opened at 1.4915 German marks, down from the previous close at 1.4965.

In Zurich, the dollar opened at 1.2405 Swiss francs, down from the previous close at 1.2460.

In London, the pound opened at $1.6315, up from the previous close at $1.6192.

In Paris, the dollar opened at 5.1115 French francs, down from 5.1490 at the previous close.

In Brussels, the dollar opened at 30.72 Belgian francs, down from the previous close at 30.94.

In Rome, the dollar opened at 1,524.35 lira, down from the previous close at 1,532.31 lira.

Gold opened at $391.75 an ounce in Zurich, up from the previous close at $390.75, while in London it started trading at $391.75, up from the previous close at 390.75.

Gold closed at $391.75 in Hong Kong, up from $390.75 at the previous close.

Silver opened at $5.41 in Zurich, up from the previous close at $5.40, while in London it opened at $5.43, up from the previous close at $5.40.