The dollar slipped against the Japanese yen Monday ahead of crucial policy meetings of the Federal Open Market Committee and the Bank of Japan.
The FOMC is slated to meet Tuesday and Wednesday, when it is widely expected to announce the end of its bond-buying stimulus program. The BOJ meets on Friday.
“Investors will likely sit on sidelines ahead of a slew of incentives” that have the potential to move the market, said Koji Fukaya, chief executive of FPG Securities.
The dollar USDJPY, -0.70% weakened to ¥107.88 from ¥108.16 late Friday in New York.
Meanwhile, the euro EURUSD, +0.28% was at $1.2684, from $1.2672. The shared currency EURJPY, -0.39% was at ¥136.82, down from ¥137.02.
“The probability that the Federal Reserve will turn to a hawkish stance is low,” at the conclusion of its two-day meeting, said Junichi Ishikawa, market analyst at IG Securities.
Considering dovish comments from the Fed officials recently, the Fed will likely retain its guidance that short-term interest rates will remain near zero for a “considerable time,” said Mr. Ishikawa. The Fed also will likely put more emphasis on its stance to stay data-dependent when making a decision to raise rates. By doing so, the central bank may be able to bring early rate-hike expectations under control.