By Sara Sjolin, MarketWatch , Hiroyuki Kachi The dollar extended its losses against other major currencies on Friday, underscoring investors' wariness over weakness in the global economy and markets after the Federal Reserve's decision to keep interest rates unchanged. The Federal Reserve left short-term interest rates unchanged Thursday (http://www.marketwatch.com/story/federal- reserve-opts-to-keep-interest-rates-near-zero-2015-09-17) after weeks of market-churning debate over whether the central bank would end an era of near-zero rates. Fed Chairwoman Janet Yellen said concerns about inflation, China and financial markets contributed to the Fed's decision to stand pat. "We view the Fed's statement as dovish, lowering the odds of a rate hike in the near term," analysts at Goldman Sachs Asset Management said in a note after the central-bank decision. "The timing will depend on developments in financial conditions and economic data, but we believe an October rate hike is unlikely and the December meeting is a toss-up. We think this delay could dampen market volatility in the near term, though uncertainty about Fed policy could lead to more volatility as the December meeting approaches," they said. The ICE Dollar Index dropped 0.3% to 94.224, setting it on track for the lowest close since Aug, 25, according to FactSet data. The greenback was at Yen119.24, compared with Yen120.03 late Thursday in New York, tracking the overnight dollar selling that brought the U.S. currency from around Yen120.90 before the Fed concluded its two-day policy meeting. Read: Yellen on when the Fed could act, market volatility and income inequality (http://www.marketwatch.com/story/in- her-own-words-yellen-on-when-the-fed-could-act-market-volatility-and-income-inequality-2015-09-17) The U.S. currency also dropped against the euro, which climbed to $1.1450, hitting a three-week high. The shared currency traded at $1.1434 late Thursday in New York. "The dollar was weaker across the board," said Minori Uchida, head of Tokyo global markets research at Bank of Tokyo- Mitsubishi UFJ. "We are now a distance away from the rate increase (in the U.S.)," said Uchida, adding that future rate increases have become "more uncertain." Opinion: Spooked by global events, the Fed won't raise rates (http://www.marketwatch.com/story/spooked-by-global- events-the-fed-wont-raise-rates-2015-09-17) The greenback has been under pressure on disappointment from the Federal Open Market Committee's dovish statement, prompting investors to close out their long-dollar positions. The selling was been accelerated by a sharp decline in the benchmark Nikkei Stock Average midday, which deepened the risk-averse mood and prompted buying into the perceived safety of the Japanese currency. The Nikkei closed 2% lower.

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