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FOREX-Dollar falls as soft U.S. data turns back Fed gains

* Housing starts, consumer mood data raise doubts on U.S. growth

* Yen bounces back after weakness from Bank of Japan policy decision

(New throughout, updates quotes, market activity, comments and data to afternoon U.S. trading) NEW YORK, June 16 (Reuters) - The dollar fell broadly on Friday after weaker-than-forecast data on housing and consumer sentiment cast a risk-off sentiment over U.S. assets. The greenback gave back most of the previous day's gains, easing toward levels from earlier this week that were the lowest since November. Disappointing economic readings and the lack of progress on fiscal stimulus from Washington have overshadowed the likelihood of more rate hikes from the Federal Reserve. The government said U.S. home construction fell in May for a third straight month, to its lowest in eight months. The University of Michigan said its gauge on consumer sentiment deteriorated in early June. "It raises some doubt on U.S. growth for the rest of the year," said Minh Trang, senior currency trader at Silicon Valley Bank in Santa Clara, California. The dollar index was down 0.3 percent at 97.126, and on track for a 0.14 percent decline on the week. The dour U.S. data boosted the yen, which had slid to a two-week low versus the dollar. "The move in the yen very much coincided with a strengthening of bonds in the U.S., which also coincided with a selling off in (U.S.) equity markets," said Axel Merk, president and portfolio manager at Merk Hard Currency Fund in Palo Alto, California. "My guess would be that the risk-off environment prevailed." Earlier, the yen had weakened after Bank of Japan Governor Haruhiko Kuroda said there was "some distance" to achieving the BoJ's inflation target of 2 percent, and it was "inappropriate" to say how the Bank would exit its massive stimulus program as domestic inflation has remained sluggish. That ran contrary to market speculation in the past month that the BoJ could be considering its own plan for eventually withdrawing emergency stimulus for the world's third largest economy. The euro rose 0.35 percent against the yen to 124.04 yen after touching a near two-week high earlier Friday. The common currency was up 0.4 percent versus the dollar at $1.1191, but about a cent below a seven-month peak of $1.1296 hit before the Fed's widely expected rate hike on Wednesday.

Description RIC Last U.S. Close Pct YTD Pct Previous Change Change

Session

Euro/Dollar EUR= $1.1196 $1.1143 +0.48 +6.50 Dollar/Yen JPY= 110.7800 110.9100 -0.12 -5.21 Euro/Yen EURJPY= 124.04 123.63 +0.33 +0.73 Dollar/Swiss CHF= 0.9732 0.9750 -0.18 -4.38 Sterling/Dollar GBP= 1.2788 1.2754 +0.27 +3.66 Dollar/Canadian CAD= 1.3217 1.3268 -0.38 -1.59 Australian/Dollar AUD= 0.7623 0.7576 +0.62 +5.65 Euro/Swiss EURCHF= 1.0896 1.0868 +0.26 +1.67 Euro/Sterling EURGBP= 0.8753 0.8737 +0.18 +2.76 NZ Dollar/Dolar NZD= 0.7254 0.7206 +0.67 +4.51 Dollar/Norway NOK= 8.4438 8.5054 -0.72 -2.24 Euro/Norway EURNOK= 9.4559 9.4785 -0.24 +4.07 Dollar/Sweden SEK= 8.7055 8.7500 -0.07 -4.42 Euro/Sweden EURSEK= 9.7455 9.7528 -0.07 +1.73

(Reporting by Dion Rabouin; Additional reporting by Ritvik Carvalho in London, Tokyo Markets team; Editing by Chris Reese and David Gregorio)

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