The U.S. dollar hit its highest in more than six weeks against the yen on Wednesday as traders digested the possibility of ultra-long U.S. bond issuance, and after strong U.S. services sector growth kept hopes alive for a Federal Reserve interest rate increase in June.
In a move largely expected in financial markets, the policymaking Federal Open Market Committee (FOMC) unanimously agreed later Wednesday afternoon to keep its benchmark rate target at 0.75 percent to 1 percent.
Adjustments from previous statements indicated that Fed officials judged at this week's two-day meeting that "economic activity slowed" while "household spending rose only modestly."
The dollar index, which measures the greenback against a basket of six major rivals, climbed slightly higher on this news, nearing the $100 mark.
The Institute for Supply Management (ISM) also said Wednesday its index of non-manufacturing activity rose to 57.5 in April from 55.2 the month before. The reading was above expectations of 55.8 from a Reuters poll of economists and dealt some relief to investors after a recent run of weak U.S. economic data.