NEW YORK: The US dollar tumbled against the yen after the Bank of Japan left its monetary policy unchanged, while benchmark US bond yields fell to near 4-1/2-month lows after the US economy grew less than expected in the first quarter.
The disappointing growth rate spurred concerns about a tepid outlook for the US, which along with recent concerns that China’s growth is slowing, also hit the price of oil.
The BoJ held off from announcing new monetary policy, which was not unexpected, but board members suggested inflation may still fall short of the central bank’s target for some time. The outlook on inflation in the bank’s semi-annual economic report highlighted concerns that the BoJ has an unrealistic goal in its battle to end 15 years of deflation.
Traders said market expectations for ongoing weakness in the yen had come too far, too quickly. Recent lackluster US data has added to dollar selling, which accelerated yesterday.
The dollar fell as low 97.54 yen and was recently down 1.2 percent at 98.09. Wall Street was slightly lower by mid-afternoon, putting the S&P 500 on track to snap a five-day winning streak. A drop in Amazon.com also weighed on the market after the Internet retailer gave a disappointing outlook, sending its shares down nearly 7 percent.
The Dow Jones industrial average edged up 18.68 points, or 0.13 percent, at 14,719.48. The Standard & Poor’s 500 Index slipped 2.47 points, or 0.16 percent, to 1,582.69. The Nasdaq Composite Index lost 10.55 points, or 0.32 percent, to 3,279.44.
Dollar falls against yen
