TOKYO: The dollar paused in Asia on Wednesday after rallying on the back of data that showed US economic growth at its highest level in over a decade.
The greenback got a boost on Tuesday as the US Commerce Department raised its estimate for third-quarter growth from 3.9 percent to 5.0 percent, the best since 2003.
The news fuelled hopes the US Federal Reserve will start to raise interest rates from current record lows faster than other major central banks.
In Tokyo on Wednesday, the US unit bought 120.39 yen, slipping from 120.71 yen in New York, but still up from 120.13 yen in Asian trade earlier Tuesday.
The euro was mixed at $1.2177 and 146.60 yen, from $1.2171 and 146.94 yen in US trade.
"With oil prices falling and employment strengthening, it appears likely that momentum in consumer spending should continue to be a driving force for US growth," National Australia Bank said.
Real personal spending increased 3.2 percent, accelerating from an increase of 2.5 percent in the second quarter.
"A 0.7 percent (point) rise in real personal spending had some analysts querying whether Q4 GDP will also exceed three percent and asking whether the Fed may well commence its tightening ahead of mid-year," the bank said in a note.
IG Securities market analyst Junichi Ishikawa said the dollar could even test the 121 yen level.
"There is a feeling in the market that the swing back to risk-taking sentiment has come earlier than expected," he told Dow Jones Newswires.
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