BOJ intervention fails to keep dollar in 117 yen territory.

TOKYO, Sept. 21 Kyodo

The U.S. dollar failed to stay in 117 yen territory Friday in Tokyo, as selling of the dollar to take profits swamped rounds of yen-selling intervention by the Bank of Japan (BOJ).

The dollar was quoted at 116.76-79 yen, up from 116.25-35 yen at 5 p.m. Thursday in New York. It was traded at 117.23-26 yen late Thursday in Tokyo.

During the day, the dollar moved between 116.33 yen and 117.48 yen, trading most frequently at 117.20 yen.

The 5 p.m. quote for the euro was $0.9204-9207 and 107.48-52 yen, compared with $0.9270-9280 and 107.85-95 yen at 5 p.m. Thursday in New York.

As widely anticipated, the BOJ stepped into the market for the third time this week to stem the yen's rise, sending the dollar into 117 yen territory in the morning.

The dollar had hit a seven-month low in the 115 yen level Thursday in New York on mounting fears of the U.S. economic fallout  after last week's attacks on the World Trade Center and the Pentagon.

Dealers believe the Japanese central bank conducted rounds of yen selling in the afternoon as well, keeping the U.S. currency above 117.00 yen until midafternoon.

But toward late afternoon, profit-taking selling of the dollar gradually outweighed the intervention effects, dealers said. There were many interbank dealers who had taken long dollar positions in anticipation that they could sell the dollar to take quick profits if the BOJ boosts the value of the U.S. currency.

''We have seen a pattern in the past few days that the dollar rises with BOJ intervention in Tokyo, and comes back to losing ground in overnight trading,'' said Daisuke Uno, chief market analyst at Sumitomo Mitsui Banking Corp.

''Under the circumstances, players tend to take a short-term view,'' buying the dollar on dips and selling it on any rebound to make a profit, he said.

Masahiro Ishikawa, vice president and analyst at Bank One's Tokyo unit, said the BOJ is the sole defender of the dollar at present.

''As long as U.S. stocks keep falling, which I think would continue for a while, the dollar remains under pressure,'' he said.

Given U.S. Treasury Secretary Paul O'Neill's tacit support expressed earlier this week for its intervention, the BOJ is likely to continue stepping into the market, and that will make the dollar-yen rate move next week in a somewhat similar way to this week's ups and downs, dealers said.