Dollar Slides To 9-Month Low On Fujii Remarks

TOKYO (Kyodo)--The U.S. dollar briefly fell to a nine-month low in the lower 88 yen range Monday morning in Tokyo on continued yen buying after Japan's finance minister showed a negative stance toward intervention to stem the strength of the Japanese currency.

At noon, the dollar was quoted at 89.14-15 yen, down from 89.58-68 yen in New York and 90.59-61 yen in Tokyo at 5 p.m. Friday.

The dollar briefly fell to 88.23 yen in early Tokyo deals, its lowest level since mid-December last year in local trading and its lowest since late January in overseas trading.

The euro traded at $1.4584-4589 and 130.02-06 yen against $1.4687-4697 and 131.60-70 yen in New York and $1.4684-4685 and 133.03-07 yen in Tokyo late Friday.

Recent remarks by Finance Minister Hirohisa Fujii, who reiterated opposition toward currency intervention aimed at weakening the yen to support Japanese exporters, prompted short-term speculators to buy the yen against other currencies, dealers said.

During his bilateral talks with U.S. Treasury Secretary Timothy Geithner in Pittsburgh last week, Fujii said Japan would ''in principle'' not intervene in the currency market.

''There is a sense of security in yen buying,'' said Koji Fukaya, senior currency strategist at Deutsche Securities Inc. ''His remarks were perceived (by the market) as (Japan) accepting a strong yen,'' he said.

The dollar also came under pressure partly on speculation that the U.S. Federal Reserve will maintain an ultra-easy credit policy for the time being to shore up the economy after the Group of 20 economies agreed at the end of summit in Pittsburgh on Friday that it is necessary to maintain economic stimulus measures, dealers said.

Later in the morning, however, the dollar rebounded to the lower 89 yen level as investors took profits from the yen's steep rise, dealers said.

Some dealers also said that a higher yen versus the dollar also resulted from expectation that Japanese exporters will repatriate their profits at the end of fiscal first half this week.