Asian session: The yen strengthened against all of its 16 major counterparts

The yen strengthened against all of its 16 major counterparts after the Bank of Japan refrained from expanding monetary stimulus that debases the currency. The BOJ kept its asset-purchase fund at 40 trillion yen ($506 billion) today, matching the forecasts of 13 economists surveyed by Bloomberg News.

The central bank unexpectedly increased the fund on Feb. 14 and introduced a 1 percent inflation goal. That triggered a 1.1 percent drop in the yen that day against the dollar, then the most since Oct. 31 when Japan intervened in to stem a gain in its currency.

The dollar was set for weekly declines versus most major peers before U.S. data that may show production slowed and consumer confidence fell, adding to the case for further easing by the Federal Reserve. U.S. data due today are projected to show the recovery in the world’s largest economy is losing momentum. Growth in industrial production probably slowed to 0.1 percent last month from 1.1 percent in April, according to the median estimate of economists surveyed by Bloomberg News.

A gauge of manufacturing in the New York region fell to 13 in June from 17.1 in May, a separate survey showed. The Thomson Reuters/University of Michigan preliminary index of sentiment declined to 77.5 this month from 79.3 in May, the highest since October 2007, economists forecast.The central banks of major economies are preparing for coordinated action to provide liquidity if needed after the general election in Greece this weekend, Reuters reported earlier.

Demand for the euro was damped after Moody’s Investors Service downgraded five Dutch banking groups. In a statement dated today, the rating company cited risks to the economic outlook and “fragile” investor confidence in Europe.

EUR/USD: during the Asian session the pair updated a week’s high.

GBP/USD: during the Asian session the pair fell.

USD/JPY: during the Asian session the pair fell below Y79.00.

Also at 0900GMT, German Chancellor Angela Merkel is due to deliver a speech at a business conference, in Berlin, while at 0930GMT,

German Finance Minister Wolfgang Schaeuble is also due to deliver a speech. UK data at 0830GMT includes Trade data as well as Construction Output. US data starts at 1230GMT when the NY Fed Empire State Manufacturing Index is expected to fall to a reading of 13.5 in June after see-sawing sharply in the previous two months. At 1315GMT, industrial production is expected to hold steady in May after the April rebound. At 1355GMT, the Michigan Sentiment Index is expected to fall to a reading of 77.8 in early-June after rising in each of the last nine months.