* Dollar nurses losses after Fed keeps interest rates
* Fed signals less aggressive rate rises in coming years
* Dollar/yen hits lowest level in nearly 4 weeks
* RBNZ keeps rates steady, retains easing bias
By Masayuki Kitano
SINGAPORE, Sept 22 The dollar hit a near 4-week
low against the yen on Thursday after the U.S. Federal Reserve
kept monetary policy steady and projected a less aggressive path
for interest rates hikes in coming years.
The Fed strongly signalled that it could raise interest
rates this year if the labour market improved further. The U.S.
central bank noted U.S. economic activity had picked up and job
gains were "solid" in recent months.
Fed policymakers, however, 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,
according to the median projection of forecasts released with
its post-meeting statement on Wednesday.
The dollar fell 0.2 percent to 100.15 yen and touched
a low of 100.12 yen at one point, its lowest level since Aug.
26. On Wednesday, the dollar had slid nearly 1.4 percent against
The dollar had already been on the defensive against the yen
before the Fed's policy statement, as the yen pushed higher
after the Bank of Japan overhauled its policy focus.
The BOJ made an abrupt shift on Wednesday to targetting
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.
Investors took a sceptical view of the BOJ's ability to
generate inflation through the new measures, which drove the yen
higher against the dollar.
The yen could see further gains against the dollar,
especially if there are any episodes of investor risk aversion
going forward, said Satoshi Okagawa, senior global markets
analyst for Sumitomo Mitsui Banking Corporation in Singapore.
"The dollar will probably trade at around 99 yen to 102 yen,
but if any risk-off moves were to occur, a new range of 95 yen
to 100 yen could come into view," he said.
The dollar index, which measures the greenback's value
against a basket of six major currencies, touched a low of
95.398 at one point on Thursday, its lowest level
since Sept. 16.
The euro edged up 0.1 percent to $1.1195, having
pulled up from Wednesday's trough of $1.1123.
The New Zealand dollar slipped briefly after the Reserve
Bank of New Zealand (RBNZ) left the door wide open for another
interest rate cut this year.
The RBNZ kept its benchmark interest rate unchanged at 2.0
percent on Thursday but reiterated that further easing will be
The New Zealand dollar slipped to as low as $0.7316
earlier on Thursday, but later regained its footing and was last
trading at $0.7362, up 0.2 percent from late U.S. trade
(Reporting by Masayuki Kitano; Additional reporting by Swati
Pandey in Sydney; Editing by Eric Meijer)