The dollar's woes deepened on Thursday as FX positioning ahead of next week's U.S. presidential election overshadowed the Federal Reserve's latest FOMC decision, where policymakers signaled they were on track to hike rates next month.
The greenback gave up its early modest gains and slipped against the yen with markets in Japan closed for a public holiday.
USD/JPY was down more than 0.7 percent at 102.54, plunging to its lowest levels in almost a month and well off its Oct. 28 high of 105.53.
Despite Democratic candidate Hillary Clinton, who is considered as the status quo candidate for markets, remains ahead in many polls before Tuesday's vote, some forex investors have begun pricing in the possibility of victory for her Republican rival Donald Trump.
The Bank of Japan held back from expanding its monetary policy on Tuesday despite pushing back the time frame for hitting its 2 percent inflation target.
The Fed left interest rates unchanged on Wednesday as widely expected in its last policy decision before the Nov. 8 vote, and signaled it could hike rates in December as the economy gathers momentum and inflation picks up.
On Friday, key U.S. jobs data will be published, and could reinforce or undermine those hike bets. Employers are expected to have added 175,000 jobs in October, but traders are more keen to focus on the election.
EUR/USD was up more than a quarter percent to 1.1125, its highest peak since Oct. 11.
The dollar slipped 0.3 percent against the Swiss franc to 0.9694 franc, gearing up to test its overnight low of 0.9691 which was its lowest level since Oct. 3.
AUD/JPY tumbled around 0.7 percent to 78.57, its lowest since Oct. 14, despite the Aussie holding its ground against the buck.
The Mexican peso, considered a proxy for Trump's campaign due to that candidate's vows to curb immigration and reconsider trade relations, fell to more than one-month lows against the dollar.
USD/MXN fell as low as 19.5172, its weakest since Sep. 30.
