The dollar tumbled against major currencies on Thursday, a day after the Federal Reserve pared back expectations for interest rate increases, while the yen was volatile on speculation the Bank of Japan was concerned about the Japanese currency's strength.
The dollar fell 1 percent against a basket of currencies. Against the yen, it dropped sharply early in the session but bounced back on news that the Bank of Japan was asking dealers about recent movements in the yen.
A source familiar with the matter told Reuters that the central bank was asking market players about the causes of sudden moves in the dollar/yen.
The dollar, which had earlier hit a low of 110.68 yen, rebounded and was last trading at 111.48. In the last month, the yen has been strengthening against the dollar after the Bank of Japan elected to move to a negative-interest-rate policy at the end of January. The dollar's low on Thursday represented its lowest level since October 2014.