The dollar slipped against the yen on Friday after a set of stimulus measures the Bank of Japan unveiled were deemed too modest to drive the greenback higher. The BOJ on Friday said after its policy meeting that it would expand the types of assets it purchases, sending the dollar briefly soaring versus the yen. But the greenback slid as it became clear that the central bank would not expand its base money target under its massive stimulus program. The dollar initially rose to 123.59 JPY= after the BOJ announcement, but was last down 0.5 percent at 121.895 yen. "I don't think many people were expecting the BOJ to make a move right after the FOMC, so the timing of the announcement came as a surprise," said Ayako Sera, senior market economist at Sumitomo Mitsui Trust in Tokyo. "But upon closer inspection the contents show that the BOJ merely fine-tuned its policy, which is why the dollar came down." The BOJ decided to set aside 300 billion yen to buy exchange-traded funds (ETFs) that specifically target shares of companies actively pursuing capital expenditure. It will also extend the maturity of JGBs it buys to 12 years from 10 years next year. More substantially, the central bank kept intact its policy target of increasing base money - or cash and deposits in circulation - at an annual pace of 80 trillion yen ($655 billion) via aggressive buying of government bonds, ETFs and trust funds investing in property. The U.S. dollar index .DXY slipped 0.4 percent to 98.910 after hitting 99.294 overnight, its highest in two weeks. The index posted a 1.2 percent gain on Thursday - its biggest rise in over a month. The greenback advanced broadly after the Fed on Wednesday lifted its benchmark rate off zero. The euro was up 0.2 percent at $1.0850 EUR=, pulling away from a 10-day low of $1.0802 hit overnight. "A lot of short positions in the yen and euro versus the dollar were formed well in advance of the Fed's hike. Now that the hike is out of the way, focus is on the commodity markets," said Junichi Ishikawa, market analyst at IG Securities in Tokyo. "The drop in commodities and its negative impact on emerging market and commodity currencies could damage risk sentiment and prompt covering of short positions in units like the yen." Hurt by a stronger dollar and a global glut that showed no signs of abating, U.S. crude CLc1 was on track to drop 2.3 percent this week. The greenback's appreciation also took a toll on base and precious metals. The Canadian dollar was now close to a 12-year low, having come within a whisker of C$1.40 per USD CAD=D4. The Australian dollar briefly dipped below 71 U.S. cents AUD=D4 for the first time in a month, before edging back to $0.7138. Its New Zealand counterpart fell to its lowest in over a week at $0.6680 NZD=D4. Argentina's peso plunged more than 26.5 percent on Thursday as a new government floated the currency as part of a slew of free-market reforms. ($1 = 122.1400 yen)
