The dollar slipped to near 4-week trough against the yen on Thursday after the US Federal Reserve left rates unchanged and projected a less aggressive path for interest rates hikes in coming years.
The Fed however strongly suggested that it could hike interest rates this year if the labour market continued to improve. Fed policymakers noted that economic activity had picked up and job gains were "solid" in recent months.
The same policymakers however, according to the dot-plot, cut the number of rate increases they expect this year to one from two, and also projected a less aggressive rise in interest rates next year and in 2018.
USD/JPY fell to 100.08 overnight, its lowest level since Aug. 26. On Wednesday, the dollar had slid nearly 1.4 percent against the yen.
The Bank of Japan made an abrupt shift on Wednesday to targeting yields on government bonds to achieve its elusive inflation target, after years of massive money printing failed to jolt the economy out of decades-long stagnation.
Forex investors are unconvinced of the BOJ's ability to generate inflation through the new measures, which gave a fresh bout of strength to the yen.
EUR/USD rose almost half a percentage point to 1.1239 overnight, having pulled up from Wednesday's trough of 1.1123.
