the Bank of Japan left borrowing costs unchanged.

The bulk of the dollar's rally came earlier today after

Japan's central bank held its benchmark rate at 0.25 percent,

the lowest among industrialized nations. Traders boosted the

dollar further as U.S. statistics showed strength in housing,

labor markets and manufacturing, and climbing consumer prices.

"The real risk is that the Fed's next move is up rather

than down,'' said Paresh Upadhyaya, who helps manage $29 billion

in currency assets at Putnam Investments in Boston. "The dollar

is clearly benefiting from that.''

The dollar climbed to 121.24 yen at 4:02 p.m. in New York

from 120.67 yen late yesterday, and reached 121.60 yen, the

highest since March 21, 2003. The yen fell to 157.14 per euro

from 156.12, about one yen from this month's record low of 158.06.

The dollar fell to $1.2962 per euro from $1.2938 yesterday.

It erased an earlier advance on speculation "sovereign buyers''

were purchasing euros at about $1.29, said Grant Wilson, a