Tokyo - Tokyo stocks closed 0.55 percent lower Friday after the dollar fell against the yen on a cautious view of the US economy by Federal Reserve chief Janet Yellen.
The Nikkei-225 index dropped 82.04 points to 14,841.07, while the Topix index of all first-section issues lost 0.47 percent, or 5.69 points, to 1,211.66.
Yellen told the Senate Banking Committee that a severe cold snap was to blame for a disappointing run of economic data over the past two months, including on jobs, industrial output and consumption.
However, she said bank policymakers would keep an eye on the economy to see if the weak figures continue, which could lead to a slower pace of cuts to its stimulus programme.
Yellen's comments put pressure on the dollar, as a continuation of the Fed's bond-buying scheme would mean more cash in financial markets.
Each of the Fed's past two policy meetings have seen it cut its bond purchases by $10 billion a month, to a current $65 billion.
The dollar slipped to 101.80 yen in Tokyo afternoon trade from 102.15 yen in New York Thursday afternoon.
“The market is naturally nervous about the Fed remaining steadfast about taking the training wheels off the wobbling economy,” said CLSA equity strategist Nicholas Smith, noting Yellen's acknowledgement of signs of softness in the economy.
“Frankly, I don't think she'll take her foot off the brakes (on stimulus) unless the data give her a very strong reason to, however,” he told Dow Jones Newswires.
Daiwa Securities chief technical strategist Eiji Kinouchi also said: “The lack of transparency with the Ukraine political crisis and other factors are translating into a lower US Treasury yields and a weaker dollar.”
Automakers were down.
Honda Motor fell 1.40 percent to 3,647 yen, and Toyota slipped 1.18 percent to 5,839 yen.
Sony rose 1.30 percent to 1,780 yen following news reports that it plans to sell its former headquarters and other properties at a premier Tokyo site that once served as the control tower for its sprawling operations.
Reaction was muted to a raft of Japanese government data showing inflation saw a year-on-year rise for the eighth straight month in January - largely on higher energy bills - while factory output rose 4.0 percent on-month.
On Wall Street the S&P 500 climbed 0.49 percent to a new record while the Dow rose 0.46 percent.
The Nasdaq ended 0.63 percent higher, at its best level since the dot-com crash of 2000. - Sapa-AFP