Yen Weakens on Outlook for Fed to Maintain Stimulus; Pound Drops

The yen fell against all 16 of its major peers as Federal Reserve officials’ statements that the economic recovery isn’t strong enough to start tapering bond-buying boosted speculation that Japan’s currency will be more responsive to the country’s own stimulus efforts.

The Bloomberg U.S. Dollar Index pared a loss versus the greenback after New York Fed President William C. Dudley said the central bank may prolong its asset-purchase program if the economy’s performance fails to meet the Fed’s forecasts. The euro gained earlier against the dollar as economic confidence in the countries that share the currency improved more than economists predicted. The pound dropped as disposable income plunged in the first quarter by the most in 25 years.