TOKYO (Kyodo) -- The yen weakened sharply to a five-month low in the upper 156 range against the U.S. dollar on Thursday in Tokyo, as the Bank of Japan signaled caution about further tightening of monetary policy after leaving interest rates unchanged.

Stocks ended lower for the fifth straight trading day as sentiment was dampened by steep losses on Wall Street overnight after the Federal Reserve indicated there may be fewer interest rate cuts than expected next year amid rising inflation risks.

At 5 p.m., the dollar fetched 156.46-49 yen compared with 154.77-87 yen in New York and 153.57-59 yen in Tokyo at 5 p.m. Wednesday.

The euro was quoted at $1.0394-0396 and 162.64-68 yen against $1.0346-0356 and 160.27-37 yen in New York and $1.0496-0498 and 161.19-23 yen in Tokyo late Wednesday afternoon.

The yield on the benchmark 10-year Japanese government bond rose 0.020 percentage point from Wednesday's close to 1.080 percent as the debt was sold on higher U.S. Treasury yields following the Fed's policy meeting.

The yen came under pressure as the dollar attracted buying after the Fed expressed a cautious stance on further policy easing, sending U.S. Treasury yields higher.

The Japanese currency extended its losses, falling to the 155 range against the dollar after the BOJ held rates steady. It dropped to 156.77 in Tokyo as BOJ chief Kazuo Ueda said the bank needs to assess additional data before considering further rate hikes, continuing its slide to the 157 line in European trading.

"Overall, (his remarks were) dovish," as he avoided giving any hints about a possible rate hike in January, said Yukio Ishizuki, senior foreign exchange strategist at Daiwa Securities Co.

His press conference fueled speculation that another rate increase could occur in March or later, with Ueda also citing uncertainties over U.S. economic policies after incoming President Donald Trump takes office next month, Ishizuki added.

Stocks opened sharply lower but trimmed some losses as investors hunted for bargains after recent declines, brokers said.

The 225-issue Nikkei Stock Average ended down 268.13 points, or 0.69 percent, from Wednesday at 38,813.58. The broader Topix index finished 6.04 points, or 0.22 percent, lower at 2,713.83.

On the top-tier Prime Market, decliners were led by nonferrous metal, real estate, and electric power and gas issues.