BoJ sees end to Japan's deflation, US growth rebounds less than expected

Japan reported on Friday that its consumer prices excluding fresh food fell 0.5 percent in March from the previous year, signalling continued deflation.

There was no immediate reaction from the Bank of Japan. Its latest monetary policy meeting ended on Friday without new policy action.

Instead, the BoJ raised its forecasts for growth and inflation. The economy is now expected to grow 2.9 percent for the fiscal year to March, up from an earlier 2.3 percent projection in January. Inflation is expected to hit 0.7 percent, up from an earlier 0.4 percent projection.

In the US, a report on Friday showed that the economy rebounded in the first quarter to grow at a 2.5 percent annualised rate after having grown at a 0.4 percent rate in the previous quarter. However, the first quarter growth was less than the 3 percent growth estimated by economists surveyed by Bloomberg.

Another report from the US on Friday showed that the Thomson Reuters/University of Michigan final index of consumer sentiment declined to 76.4 in April from 78.6 a month earlier. The preliminary April reading had been 72.3.

The weaker-than-expected growth in the US economy helped push the US dollar down 1.2 percent against the yen on Friday. The yen also rose 1.1 percent versus the euro.