TOKYO: The euro was steady in Asian trade on Wednesday, while the yen got a boost as the Bank of Japan starts a two-day policy meeting.
The euro bought $1.2260 and 97.27 yen in Tokyo trade, from $1.2251 and 97.26 yen in New York late Tuesday.
The dollar weakened to 79.32 yen from 79.41 yen amid speculation that Japan's central bank will usher in further easing measures to power the world's third-largest economy.
Weighing on the euro were comments from Italian Prime Minister Mario Monti who said the nation's public deficit would be worse than expected this year, stoking speculation about the country needing to tap a regional rescue fund.
Europe's plans to launch a permanent bailout fund and cement a European fiscal pact faced another roadblock Tuesday, as Germany's top court resisted calls to speed up its decision on whether the fund is compatible with the country's constitution.
"The market was looking for a quick rubber stamp and that wasn't forthcoming," said Auckland-based HiFX senior trader Stuart Ive.
Traders also digested a deal to offer Spain 30 billion euros ($37 billion) this month to help its distressed banks, amid scepticism over the ability of the agreement to fix the eurozone's myriad troubles.
The pact also included an extension of a deadline for Madrid to cut its public deficit to the EU's 3.0 percent limit by one year to 2014 because of the difficult economic conditions it faces.
Looking ahead, dealers were keeping an eye on the Bank of Japan meeting starting Wednesday and the release of minutes of a US Federal Reserve policy meeting on Thursday.
"If (the Fed minutes) show that a move to reactivate outright quantitative easing was actively discussed, risk sentiment should be bolstered," said National Australia Bank in a note.
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