The yen ticked about 0.2% lower to 143.29 per dollar after the Bank of Japan (BOJ) left interest rates at 0.5%, as expected.

The dollar notched its largest monthly fall for 2-1/2 years through April, as President Donald Trump’s flip-flopping tariffs hit growth expectations and rattled confidence.

However, it has come off lows as Trump has suspended much of the hit and hinted at deals, including with China, which has the highest levies.

Overnight, the dollar was about 0.5% stronger against the euro to trade at US$1.1310 per euro in the Asia morning.

It rose by a similar amount against sterling, leaving it at US$1.3315 per pound.

“We’re in a window here where we’re on a de-escalation path, and there are some de-escalation trades around it,” said Richard Franulovich, Westpac’s head of currency strategy in Sydney.

Trump said on television yesterday that he has “potential” trade deals with India, South Korea and Japan and that there is a very good chance of cutting a deal with China.

US trade representative Jamieson Greer had said earlier yesterday that no official talks were happening with China.

A surge in imports to front-run tariffs dragged GDP growth into negative territory in the first quarter, US data showed overnight, though some economists took private demand holding up as a positive sign.

Jobless claims and the ISM manufacturing survey are due later today, though April jobs figures on Friday will be the next piece of hard data markets will use to gauge recession risks.

Expectations are for a slowdown in hiring to 130,000.

The Australian and New Zealand dollars stood steady against the dollar and are trading in the top half of recent channels.

The Aussie ticked up 0.2% to US$0.6413 with some support as a very slightly hotter-than-expected inflation reading toned down some of the more dovish bets on the rates trajectory.

The New Zealand dollar held its ground at US$0.5940.