The Australian dollar stole the spotlight on Wednesday, rallying against the greenback after an unexpected spike in inflation led investors to scale back bets on another interest rate cut.
The yen, meanwhile, briefly blipped to its session high after the Bank of Japan kept monetary policy steady as most market participants had expected, though disappointed those hoping for additional easing measures sooner rather than later ahead of a scheduled sales tax hike in April.
“There is expectation, leading up to the increase in the consumption tax, that the BOJ is going to take more expansionary measures, so whether it was January or February or March, the general consensus is that something will be done in that period,” said Bart Wakabayashi, head of forex at State Street Global Markets.
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