But the dollar trimmed its early losses and then turned upward occasionally, with the Tokyo stocks’ rebound late in the morning prompting investors to sell the safety of the Japanese currency.
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Japan’s gross domestic product for the January-to-March period grew faster than expected, with real GDP rising 0.4% on quarter compared with an economist poll forecast for 0.1 percent growth. At the meeting, the RBA reduced its benchmark cash rate to a record low 1.75 percent from 2.00 percent. Westpac is adding 0.4 percent, Commonwealth Bank is advancing 0.5 percent and National Australia Bank is up 0.2 percent after the stock went ex-dividend.
Most other regional markets also retreated after a sharp sell-off on Wall Street on Tuesday. Dow and S&P 500 futures both were down 0.1 percent.
EUROPE’S DAY: France’s CAC 40 fell 0.8 percent, while Germany’s DAX shed 1 percent.
MSCI’s broadest index of Asia-Pacific shares outside Japan lost 0.3 percent.
“We saw receding hopes for the BOJ easing”, pulling the dollar lower earlier in the session, said Shinchiro Kadota, vice president of research at Barclays in Tokyo.
Traders were likely weighing whether the good news from the data was actually good or bad news for markets. Compared with the year before, overall prices rose 1.1 percent.
Japan said the world s number three economy expanded 0.4 percent in the first three months of the year, better than expected and boosted by a pick-up in consumer spending.
The gains were trimmed however by lower-than-expected United Kingdom inflation data.
Japan´s economy is struggling in the face of a stronger exchange rate that has damaged growth, intensified deflation, crushed stock prices and prompted the Bank of Japan to impose negative interest rates on certain bank deposits.
West Texas Intermediate and Brent each put on 1.4 percent Monday.
The dollar rose 0.2% to ¥108.89 after spiking briefly on Friday to ¥109.57, its highest since late April, in reaction to strong United States data.
The Federal Open Market Committee is due to release the minutes to its April meeting on Wednesday evening, with analysts concerned the rhetoric could be more hawkish than the statement released immediately following the meeting. The Nasdaq composite gained 71 points, or 1.5 percent, to 4,789.
ENERGY: U.S. crude oil rose 6 cents to $48.37 a barrel in electronic trading on the New York Mercantile Exchange.
“The FTSE 100’s rollercoaster ride continues, starting the week with a quick dive, unwinding an impressive rally Friday afternoon”, added Lee Wild, head of equity strategy at online stockbroker Interactive Investor.
United States crude’s West Texas Intermediate (WTI) futures went up 1.1 percent to $48.24, having risen 3.3 percent on Monday.
In the oil space, Oil Search is gaining more than 2 percent, Santos is rising nearly 4 percent and Woodside Petroleum is advancing more than 1 percent after crude oil prices rose sharply overnight.
Asian shares weakened on Wednesday after strong USA inflation data and comments from Federal Reserve officials rekindled prospects of the central bank raising rates later this year.
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Japan’s Nikkei rose 1 percent thanks to a weaker yen, which fell to a three-week low against the dollar after the minutes were published.
