Yen Muted After BoJ Announcement

The yen showed muted trading against its major counterparts in the Asian session on Wednesday, after the Bank of Japan left its massive monetary policy stimulus unchanged to support the economy.

The Policy Board of the Bank of Japan voted 8-1 to retain the interest rate at -0.1 percent on current accounts that financial institutions maintain at the central bank.

The bank will continue to purchase necessary amount of Japanese government bonds without setting an upper limit so that 10-year JGB yields will remain at around zero percent.

The economy is forecast to improve gradually from the second half of the year with economic activity resuming, but the pace is expected to be only moderate while the impact of the novel coronavirus remains worldwide.

News of a coronavirus vaccine development bolstered risk appetite, weighing on the yen.

Biotech firm Moderna said its experimental vaccine for COVID-19, mRNA-1273, showed it was safe and produced strong immune responses in all 45 patients in an ongoing early-stage human trial.

The yen dropped to a 2-day low of 135.01 against the pound and held steady thereafter. The pair had ended Tuesday's trading at 134.61. The yen is seen finding support around the 136.00 mark.

The yen held steady against the greenback, after having pulled back from a high of 107.17 seen at 5:00 pm ET. At yesterday's trading close, the pair was quoted at 107.23.

The yen hit a fresh 5-week low of 122.50 against the euro, compared to yesterday's closing value of 122.24. Next key support for the yen is likely seen around the 124.00 level.

The Japanese currency retreated against the franc, after climbing to 113.95 at 5:00 pm ET. At Tuesday's close, the pair was valued at 114.07.

Looking ahead, U.K. CPI and PPI for June are due at 2.00 am ET.

U.S. import and export prices and industrial production for June, as well as Fed Beige book report are slated for release in the New York session

The Bank of Canada will announce its interest rate decision at 10:00 am ET. The BoC is widely expected to keep its policy rate steady at 0.25 percent.