Dollar dips further after Fed holds firm on stimulus

TOKYO: The dollar faced further pressure in Asia Thursday morning, extending losses seen in New York after the US Federal Reserve's surprise decision to keep its aggressive stimulus programme intact.

In morning trade, the greenback fetched 98.11 yen, down from 98.13 yen in New York on Wednesday where it had dropped from 99.19 in Tokyo before the Fed announcement.

The euro also advanced, buying $1.3523 in Tokyo -- its highest level since February -- against $1.3511 in New York, and well up from $1.3353 in earlier Wednesday.

The European currency also rose to 132.68 yen from 132.55 yen.

Investors had expected the US central bank to begin cutting down its $85 billion per month bond-buying programme following broadly upbeat data on the world's number one economy.

However, the bank instead lowered its growth forecast for 2013 and 2014, while its chairman Ben Bernanke warned of possibly "very serious consequences" from a brewing political battle in Washington over a new budget and the debt ceiling.

However, he said the Fed could still taper the programme later this year if the outlook improves.

The decision will have raised some eyebrows in markets, National Australia Bank said in a note Thursday.