The Japanese yen steadied on Tuesday after the Bank of Japan maintained interest rates during a closely watched meeting.
Initial gains for the currency evaporated as Governor Kazuo Ueda provided a neutral policy outlook during his press conference.
Despite the hold, three board members broke ranks to demand higher borrowing costs to combat rising inflationary pressures.
The central bank sharply increased its core inflation forecasts while cutting growth projections through the end of fiscal 2028.
Finance Minister Satsuki Katayama warned that authorities remain ready for decisive action to curb extreme currency market volatility.
Simultaneously, the U.S. dollar index climbed 0.18%, ending a two-day losing streak as global policy guidance took center stage.
Traders focus on the Federal Reserve’s upcoming meeting, where officials expect Chair Jerome Powell to maintain current rate levels.
High-performing corporate earnings and optimism around AI continue to support equities, offsetting some risks from elevated energy costs.
Investors now await a flurry of rate decisions from the UK, Canada, and the Eurozone later this week.
