March 28 (Bloomberg) -- The yen fell against all its major counterparts on signs the global recovery is gaining momentum, boosting appetite for higher-yielding investments. The euro erased losses against the dollar after European Central Bank President Jean-Claude Trichet said inflation rates that stick above 2 percent would be a concern. The dollar earlier advanced after Federal Reserve official James Bullard said the central bank may consider scaling back its monetary stimulus. Canada's dollar was the best performer against the dollar as crude oil traded near a two-week high amid concern renewed violence in Libya may further disrupt supplies. "Most of the monetary policy for the European Central Bank, the Bank of England and the other G10 currencies is priced in already," said Mark McCormick, a New York-based currency strategist at Brown Brothers Harriman & Co. "People are trying to hone their sights back in to the macro data and actually see what the world actually looks like." The yen weakened 0.4 percent to 81.68 per dollar at 10:28 a.m. in New York, from 81.34 March. The Japanese currency fell 0.5 percent to 115.14 per euro. The dollar traded little changed against the euro at $1.4096 after gaining as much as 0.5 percent. The Bank of Japan will lift its target for the unsecured overnight call rate by two basis points over the next 12 months, compared with 47 basis points of increases by the Fed, Credit Suisse Group AG indexes show. That compares with 124.5 basis point increase for the European Central Bank and 69.2 basis points from the Bank of England. Consumer spending in the U.S. rose more than forecast in February as incomes climbed, helping to bolster the expansion in the world's largest economy. Purchases increased 0.7 percent, the most since October, after advancing 0.3 percent the prior month, Commerce Department figures showed today in Washington. Incomes increased 0.3 percent, less than projected, and the Fed's preferred measure of inflation accelerated.

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