Yen Falls As Traders' Focus On BoJ Monetary Policy Decision

The Japanese yen weakened against other major currencies in the Asian session on Monday, as traders speculate over an end to the Bank of Japan's negative interest rate policy this week.

The positive wage data and sticky inflation reports from the nation had spurred traders to speculate the BOJ will end its ultra-loose policies, at its two-day meeting through Tuesday.

Traders also looked ahead to the U.S. central bank's monetary policy meeting this week. While the U.S. Fed is widely expected to leave interest rates unchanged, traders will look to the accompanying statement for clues about the outlook for rates.

Recent hotter-than-expected inflation readings have reduced optimism that the Fed's first-rate cut may come in June. According to the CME Group's FedWatch Tool, the probability of the Fed leaving rates unchanged at its June meeting has climbed to 43.3 percent from 25 percent. In the Asian trading today, the yen fell to near 2-week lows of 162.56 against the euro, 190.12 against the pound and 149.33 against the U.S. dollar, from last week's closing quotes of 162.24, 189.84 and 149.02, respectively. If the yen extends its downtrend, it is likely to find support around 164.00 against the euro, 191.00 against the pound and 151.00 against the greennback.

The yen dropped to a 6-day low of 169.02 against the Swiss franc, from Friday's closing quotes of 168.59. The yen may test support near the 99.00 region.

Against Australia, the New Zealand and the Canadian dollars, the yen edged down to 98.00, 90.89 and 110.25 from last week's closing quotes of 97.76, 90.60 and 110.03, respectively. On the downside, 99.00 against the aussie, 93.00 against the kiwi and 112.00 against the loonie are seen as the next support levels for the yen.

Looking ahead, Eurozone CPI for February is due to be released at 6:00 am ET in the European session.

In the New York session, Canada PPI and raw materials prices, both for February, and U.S. NAHB housing market index for March are slated for release.