Investing.com - The dollar extended losses against the yen on Tuesday, falling to an almost two-week low after Bank of Japan Governor Haruhiko Kuroda said the economy can weather a sales tax increase without further monetary policy measures to offset it.
USD/JPY touched lows of 102.53, the weakest since March 28 and was last down 0.23% to 102.59.
The pair was likely to find support at 102.00 and resistance at 103.11, the session high.
The yen strengthened after Kuroda indicated that the bank was unlikely to implement further stimulus measures in the short term. He said economic growth and inflation were likely to continue to pick up in the coming months despite a sales tax increase in April.
“We are not considering conducting additional easing at this point but we are ready to take necessary actions," Kuroda said.
"The pullback (in consumption) after the tax hike will decrease in the summer onward," he said, adding that aggressive monetary easing launched by the BoJ in April last year is working.
Japan aims to achieve sustained 2% inflation sometime between late fiscal 2014 and during the course of fiscal 2015.
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 yen also gained ground against the euro following the remarks, with EUR/JPY down 0.29% to 141.25.