TOKYO: The yen wobbled in a narrow range in early Asian trade on Tuesday as investors awaited the latest policy decision from the Bank of Japan later in the session.
The BoJ is expected to keep policy uncharged at a two-day meeting as the country's consumer prices remain on track to meet the central bank's 2 percent inflation target.
Still, some market participants did not rule out some surprise announcement, ahead of the government's planned hike to the national sales tax next month to 8 percent from 5 percent.
Moreover, data on Monday underscored the economic recovery remains fragile. Japan posted a record current account deficit in January, and its fourth quarter gross domestic product growth was revised down.
Sean Callow, currency strategist at Westpac in Sydney, said there were "very low expectations of any major policy change, though some wariness over minor tweaks."
The next meeting on April 30, at which the bank will also release its semi-annual economic outlook, seems a far more likely time for an expansion of the bank's quantitative easing scheme, Callow said in a note to clients.
The BoJ's decision is due anytime after 0300 GMT.
BoJ Governor Haruhiko Kuroda will hold a news conference after its conclusion. The dollar and euro were treading water against the Japanese currency, nearly flat on the day.
The greenback bought 103.25 yen and the single currency changed hands at 143.28 yen .
The dollar was barely changed against a basket of major currencies, holding steady at 79.752.
The euro was also steady against the dollar at $1.3877 , not far from a 2-1/2-year peak of $1.3915 touched on Friday.
The euro's resilience held up even as the crisis in Ukraine continued.
A pro-Russian force opened fire in seizing a Ukrainian military base in Crimea on Monday and NATO announced reconnaissance flights along its eastern frontiers.
Investors also warily watched developments in China, where short-term rates and the yuan both fell on Monday after weak exports data at the weekend. Some market participants speculated that China was undertaking a stealth easing of its monetary policy to bolster the flagging economy.
The Australian dollar, often used as a liquid proxy for China plays because of its sensitivity to developments in Australia's largest export market, was up about 0.1 percent at $0.9022.
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