Investing.com - The dollar fell to fresh three-and-a-half month lows against the stronger yen on Wednesday after the Bank of Japan said its stimulus program has been working as intended, and refrained from implementing additional easing measures.
USD/JPY was down 0.39% to 100.92, the weakest level since February 5.
The BoJ refrained from enlarging its stimulus program as the economy shows signs of weathering the impact of a sales tax increase that came into effect on April 1. The central bank said it will continue to expand the monetary base at a pace of ¥60 trillion to ¥70 trillion per year at the conclusion of its two-day ploicy meeting.
Also Wednesday, official data showed that Japan posted a trade deficit of ¥808.9 billion, compared to a forecast of a deficit of ¥640.0 billion.
Investors were turning their attention to of the minutes from the Fed’s latest monetary policy meeting due out later Wednesday, for insight on the central bank's view of the economy.
Recent U.S. economic reports indicating that the recovery remains uneven have weighed on U.S. Treasury yields, pressuring the dollar lower.
On Tuesday, New York Fed President William Dudley reiterated the central bank’s dovish stance, saying the pace of rate hikes was likely to be “slow”.
The euro was also trading at more than three month lows against the yen, with EUR/JPY down 0.32% to 138.38, the weakest since February 7.
The shared currency edged higher against the dollar, with EUR/USD easing up 0.08% to 1.3711, not far from the two-and-a-half month lows of 1.3647 reached late last week.
The euro remained under pressure from mounting expectations for monetary easing by the European Central Bank at its next meeting in June and data last week showing that the euro zone economy grew at a slower than forecast rate in the first quarter.
The pound pushed higher ahead of U.K. data on retail sales and the latest Bank of England minutes, due out later in the session, with GBP/USD up 0.25% to 1.6879.
The dollar slid against the Swiss franc, with USD/CHF down 0.16% to 0.8905.
The Australian dollar fell to its lowest level in two weeks, with AUD/USD slipping 0.11% to 0.9231, after data showed that consumer sentiment in Australia deteriorated this month.
Elsewhere, the New Zealand and Canadian dollars were almost unchanged, with NZD/USD at 0.8569 and USD/CAD at 1.0902.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.16% to 79.97.