Investing.com - The dollar slid against the yen on Wednesday after data revealed the U.S. economy shrank in the first quarter by much more than markets were expecting, posting its worst performance in five years.
In U.S. trading, USD/JPY was down 0.18% and trading at 101.77, up from a session low of 101.63 and off a high of 102.17.
The pair was expected to test support at 101.43, the low from May 29, and resistance at 102.17, Tuesday''s high.
The Commerce Department reported earlier that U.S. gross domestic product contracted at an annual rate of 2.9% in the first quarter of the year, far surpassing consensus forecasts for a decline of 1.7%.
U.S. first-quarter GDP was initially reported to have increased by 0.1%, but was subsequently revised to show a contraction of 1.0%.
The difference between the second and third estimate was the largest since records began in 1976, the Commerce Department added.
A separate report showed that U.S. durable goods orders fell 1.0% in May, while core durable goods orders fell 0.1%. Market expectations had been for an increase of 0.2% and 0.4%, respectively.
The data weakened the dollar by fueling expectations for the Federal Reserve to keep benchmark interest rates on hold at record lows for longer than thought.
The dollar didn''t plummet, however, as rough winter weather likely exacerbated the economy''s poor showing, while recent data has suggested that the economy has rebounded sharply from the first three months of the year.
The yen, meanwhile, was down against the euro and up against the pound, with EUR/JPY up 0.03% at 138.76, and GBP/JPY trading down 0.23% at 172.78.
On Thursday, the U.S. is to release data on personal income and expenditure, as well as data on inflation linked to personal spending.
Please LIKE our Facebook page - it makes us stronger: