Yen falls after Japan GDP misses forecasts The yen weakened on Monday after growth data showed the reform-minded administration of Shinzo Abe has more to do to set Japan firmly on the path to recovery. The dollar climbed 0.5 per cent against the yen to Y96.72 after gross domestic product data showed the Japanese economy had expanded 0.6 per cent quarter on quarter in the three months to the end of June, missing expectations of a 0.9 per cent increase. First-quarter growth, meanwhile, was revised down to 0.9 per cent from 1 per cent. The data prompted renewed speculation that further easing measures are needed to stimulate the economy, and cast some doubt that planned sales tax increases would be implemented. "Economic conditions have turned out less favourable or more tricky for the scheduled consumption tax hikes," said Kazuhiko Ogata at Crédit Agricole. He added that Mr Abe had already instructed ministers to discuss the impact of the proposed sales tax on the economy. The euro added 0.3 per cent to Y128.63, while sterling gained 0.3 per cent to Y149.62. After some substantial losses last week, the dollar began this week a little stronger. Having lost 1.4 per cent last week versus the pound, the dollar climbed 0.2 per cent to $1.5469 against the UK currency. Sterling gets its first test this week of the measures adopted by the Bank of England to set a path back to monetary normalisation. The BoE set a target unemployment rate of 7 per cent before it will consider raising interest rates. The latest UK employment data are published on Thursday. Inflationary pressures, however, would present the BoE with one so-called "knock out" clause that could prompt it to raise rates sooner than the 7 per cent unemployment level is reached. Consumer price data are due on Tuesday. The pound remained slightly higher against the euro, up 0.1 per cent at £0.8592. The euro fell 0.3 per cent to $1.3301 versus the dollar.