The Japanese yen gave up its early gains against its major counterparts in the Asian session on Tuesday, after the Bank of Japan left its policy rate and yield target for 10-year government bonds unchanged, while maintaining a cautious stance on inflationary outlook.

The decision was widely expected by economists.

Governor Haruhiko Kuroda and his board members decided by an 8-1 majority vote to hold its target of raising the amount of outstanding JGB holdings at an annual pace of about JPY 80 trillion.

The bank will purchase government bonds so that the yield of 10-year JGBs will remain at around zero percent.

The board also decided to maintain the -0.1 percent interest rate on current accounts that financial institutions maintain at the bank.

With regard to outlook, Japan's economy is likely to continue its moderate expansion.

Data from the Ministry of Internal Affairs and Communications showed that Japan's unemployment rate held steady for the third straight month in September, in line with expectations.

The jobless rate came in at 2.8 percent in September, the same rate as in August.

The currency's decline was limited to rising risk aversion, after disappointing official PMI from China.

The manufacturing Purchasing Managers' Index fell to a 3-month low of 51.6 in October from 52.4 in September, according to a data by the National Bureau of Statistics.

The yen showed mixed performance on Monday. While it rose against the greenback and the euro, it held steady against the franc. Against the pound, it dropped.

The yen dropped to 149.57 against the pound, after having advanced to 149.19 at 10:30 pm ET. The next possible support for the yen is seen around the 150.5 region.

Survey data from GfK showed that UK consumer confidence weakened in October on concerns about wider economic prospects but willingness to buy improved for the third straight month.

The consumer sentiment index fell by one point to -10 in October.

The yen reversed from an early 11-day high of 112.98 against the greenback, falling to 113.28. Continuation of the yen's downtrend may see it challenging support around the 114.00 mark.

The Japanese currency edged down to 113.72 against the Swiss franc and 131.81 against the euro, off its early highs of 113.50 and 131.55, respectively. Further weakness may take the yen to support levels of around 114.5 against the franc and 133.00 against the euro.

Following near a 2-month peak of 88.04 hit at 10:35 pm ET, the yen eased to 88.22 against the loonie. The yen is seen finding support around the 90.00 area.

On the flip side, the Japanese yen firmed to more than a 5-month high of 77.41 against the kiwi and held steady thereafter. On the upside, 76.00 is possibly seen as the next resistance for the yen.

The yen rose to 86.78 against the aussie, from its early low of 87.08, and traded sideways in subsequent part of the trading session. The pair was valued at 87.00 when it closed deals on Monday.

Looking ahead, Eurozone inflation for October, advanced GDP data for the third quarter and jobless rate for September are set for release in the European session.

In the New York session, Canada GDP data for August and industrial product price index for September, as well as S&P/Case-Shiller home price index for August and U.S. consumer confidence for October are due.

At 3:30 am ET, the Bank of Canada Governor Stephen Poloz will testify along with Senior Deputy Governor Carolyn Wilkins before the House of Commons Standing Committee on Finance, in Ottawa.

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