The US dollar traded close to a three-week high on Wednesday after the Bank of Japan (BOJ) left its ultra-easy monetary policy untouched, raising risk appetite and dragging the yen down.
The US dollar index, a measure of its strength against a basket of six major currencies, gained 0.07 percent to $96.028, staying near its three-week high of 96.484 hit in the previous session.
The safe-haven yen weakened against its peers, with dollar-yen pair climbing 0.2 percent to 109.67, while the Japanese currency dropped 0.5 percent to 78.33 against the Australian dollar.
Against the euro, the yen also shrank 0.2 percent to 124.53.
Currency markets have whipsawed in recent weeks as investors absorbed a number of issues from Brexit to decelerating word economic growth and the outlook for major central banks.
Overnight, the BOJ kept its policy unchanged at -0.1 percent as widely expected, and cut its core consumer inflation to 0.9 percent in the fiscal year starting in April from 1.4 percent.
Data from the Ministry of Finance (MOF) showed on Wednesday that Japan’s exports in December declined 3.8 percent from 2017, its biggest year-on-year fall since October 2016 and higher than the 1.9 percent slump estimated by economists.
That underlined the need for continued support for the trade-reliant economy.