Asian session: The yen weakened

The yen weakened against its 16 major peers on speculation central banks around the world will take more steps to avert a further slowdown in the economies, curbing demand for refuge assets. The Japanese currency fell to its lowest level in two weeks against the dollar as the Bank of Japan (8301) begins its two-day policy meeting today after expanding stimulus last month. The BOJ increased its asset-purchase program by 10 trillion yen ($127 billion) to 55 trillion yen at the previous meeting on Sept. 19, saying the economy’s pick-up was slowing while prices were flat.

Demand for the euro was supported before European Central Bank policy makers convene to discuss ways to contain the deepening fiscal turmoil in the region. The ECB is projected to keep its benchmark interest rate unchanged at a record-low 0.75 percent today, a Bloomberg News survey shows. ECB President Mario Draghi unveiled a program of unlimited bond purchases last month to ease borrowing costs for debt-ridden nations, spurring a rally in the shared currency.

Gains in the euro were limited before Spain sells notes maturing in 2014, 2015 and 2017 today as investors weigh whether the indebted nation will ask for an international bailout. Prime Minister Mariano Rajoy this week denied that he has immediate plans to seek assistance.

Demand for the dollar was limited before the Federal Reserve today publishes minutes of its Sept. 13 meeting, when it announced a third round of so-called quantitative easing that tends to debase the currency. The central bank will continue record stimulus even after economic expansion gains strength, Chairman Ben S. Bernanke said this week.

Australia’s dollar earlier slid to a four-week low after data showed the nation’s retail sales rose by less than economists had expected. Retail sales in Australia advanced 0.2 percent in August from the previous month, when they dropped 0.8 percent, the statistics bureau said today in Sydney. Economists had forecast a 0.4 percent increase.

EUR/USD: during the Asian session, the pair rose to yesterday's high.

GBP/USD: during the Asian session, the pair restored to $1.6100.

USD/JPY: during the Asian session, the pair rose refreshing week's high of Y78.70.

UK data sees the release of the Halifax house price index at 0700GMT, followed by the release of the UK September New car and commercial vehicle registrations data at 0800GMT. Thursday sees the announcement of the Bank of England's Monetary Policy Committee decision, at 1100GMT. At 1145GMT the ECB to announce interest rate decision is due, with no change in policy expected. However, the ECB's 1230GMT press call (policy meeting outside Frankfurt this month - in Llubjana, Slovenia) will of course be the key focus for the markets.