Dollar falls to upper 138 yen level on BOJ policy change speculation

The U.S. dollar briefly plunged to the upper 138 yen level Friday morning in Tokyo on speculation that the Bank of Japan could tweak its ultraeasy monetary policy at its meeting ending later in the day.

Tokyo stocks fell, with the Nikkei index at one stage losing over 500 points, after sentiment was hurt by a news report that the central bank will discuss a change in its policy to allow long-term interest rates to rise above its 0.500 percent cap.

The 225-issue Nikkei Stock Average dropped 437.19 points, or 1.33 percent, from Thursday to 32,453.97. The broader Topix index was down 23.58 points, or 1.03 percent, at 2,271.56.

Decliners were led by electric appliance, precision instrument and pharmaceutical issues.

© Kyodo News