TOKYO (Kyodo) -- The U.S. dollar rose above 155 yen on Wednesday in Tokyo for the first time in over three months on buying fueled by speculation that policies of U.S. President-elect Donald Trump will trigger sharp inflation and lift interest rates.

Tokyo stocks fell sharply as risk-off sentiment prevailed amid concern that Trump's protectionist policies will adversely affect Japanese firms trading with the United States.

The dollar hit 155.15 yen, its highest level since late July, on bets U.S. long-term interest rates could stay elevated as Trump's proposed policies such as tax cuts are likely to lead to higher inflation, dealers said.

But further gains in the U.S. currency were limited amid caution before the release of the U.S. consumer price index for October later in the day, analysts said.

"The dollar's further advances were stopped due to uncertainty about the CPI results as well as concerns of a possible currency intervention by Japanese authorities," said Yuzo Sakai, chief manager of business planning at Ueda Totan Forex Ltd.

At 5 p.m., the dollar fetched 155.10-12 yen, compared with 154.57-67 yen in New York and 153.81-83 yen in Tokyo at 5 p.m. Tuesday.

The euro was quoted at $1.0602-0603 and 164.44-48 yen against $1.0619-0629 and 164.25-35 yen in New York and $1.0630-0631 and 163.51-55 yen in Tokyo late Tuesday afternoon.

The yield on the benchmark 10-year Japanese government bond briefly reached 1.045 percent, the highest level in about three and a half months, before closing at 1.040 percent, up 0.035 percentage point from Tuesday's close.

The debt was sold tracking rises in long-term U.S. Treasury yields on the higher inflation prospects.

The 225-issue Nikkei Stock Average ended down 654.43 points, or 1.66 percent, from Tuesday at 38,721.66. The broader Topix index finished 33.10 points, or 1.21 percent, lower at 2,708.42.

Stocks were sold as Trump's picks for key government posts that included China hawks raised fears that higher tariffs could come early in his presidency, analysts said.

His selections "have brought global economic concerns to the fore," said Toshikazu Horiuchi, equity strategist at IwaiCosmo Securities Co.

"Japan is not immune to this, and concerns automakers may struggle to sell in the United States are keeping their stocks down despite the weaker yen," he said.

On the top-tier Prime Market, decliners were led by electric appliance, transportation equipment and consumer credit issues.