Investing.com - The dollar remained lower against the other major currencies on Tuesday, as the yen gained ground after the Bank of Japan indicated that further stimulus is unlikely in the short term, while markets eyed Wednesday’s Federal Reserve minutes.
The dollar was lower against the yen, with USD/JPY sliding 0.87% to 102.17.
The yen strengthened after BoJ Governor Haruhiko Kuroda indicated that the bank was unlikely to implement further stimulus measures at present. He added that growth and inflation were likely to continue to pick up in the coming months despite a sales tax increase in April.
Earlier Tuesday, the BoJ voted to keep its key policy target of increasing base money unchanged at an annual pace of ¥60 trillion to ¥70 trillion after ending its two-day policy meeting.
The dollar remained under pressure ahead of the minutes of the Fed’s March meeting.
Last week’s U.S. payrolls report came in slightly below expectations, while Fed Chair Janet Yellen said recently that slack in labor markets showed accommodative policies will still be needed for some time.
The euro was higher against the dollarl with EUR/USD up 0.35% to 1.3790. Demand for the euro was underpinned after comments by European Central Bank officials on Monday tempered expectations for quantitative easing.
Last week the ECB left the door open to further stimulus measures, saying that unconventional monetary policy instruments may be necessary to avert the risk of ongoing low inflation in the euro zone.
On Tuesday, the International Monetary Fund said the ECB should consider all unconventional measures, including quantitative easing, and should implement them as soon as they are ready.
In its quarterly World Economic Outlook report, the IMF said it expects the global economy to grow by 3.6% this year, and 3.9% in 2015, both 0.1 percentage point lower than in January.
The fund said it expects the euro zone economy to expand by 1.2% this year and 1.5% in 2015, both 0.1 percentage point higher than in its January forecast.
The pound was higher against the dollar, with GBP/USD gaining 0.82% to 1.6744 after the IMF upgraded its growth forecast for the U.K. economy to 2.9% in 2014, from a previous forecast of 2.5%.
Earlier Tuesday, data showed that U.K. industrial output increased at the fastest pace since June 2013 in February, boosting the outlook for the broader recovery and fuelling speculation that the Bank of England could raise interest rates sooner.
Meanwhile, the dollar slid lower against the Swiss franc, with USD/CHF down 0.37% to 0.8846.
The Australian dollar rose to four-and-half month highs, with AUD/USD up 0.72% to 0.9337, while NZD/USD climbed 0.60% to 0.8651 and USD/CAD dropped 0.37% to 1.0932.
The Canadian dollar shrugged off weaker-than-forecast data on building permits for February and a separate report showing that domestic housing starts fell in March.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.51% to a more than three-week low of 79.93.