Masafumi Yamamoto, chief forex strategist at Mizuho Securities in Tokyo, said investors will be more interested in U.S. GDP data that incorporates July, which is when tariffs against Chinese goods were activated.
The greenback had pared some of its gains about two hours after the decision, trading 0.2 percent higher at 111.30 yen.
TOKYO-The yield on the benchmark Japanese government bond posted its biggest percentage-point gain in two years, a day after Bank of Japan Gov. Haruhiko Kuroda said he would allow the yield to move in a wider band.
The BoJ meeting that ends on Tuesday will be closely watched amid speculation the central bank might tweak its massive asset-buying programme and take a step towards less monetary policy accommodation.
"Although US interest rates are widely expected to be left unchanged in July, investors are more likely to be concerned with any potential tweaks in the language of the policy statement", Lukman Otunuga, research analyst at futures brokerage FXTM in London, said in a note.
The BOJ added language to its bond buying program stating that "the yields may move upward and downward to some extent mainly depending on developments in economic activity and prices".
The Japanese central bank has also chose to change the composition of its purchases of exchange-traded funds, by buying more Topix-related ETFs while reducing the purchase of Nikkei index-linked funds.
"While various speculations are being made over the BOJ, we believe they will stand pat on monetary policy".
But there is uncertainty over how long it can sustain the current ultra-easy policy given the strain near-zero rates are inflicting on Japanese banks and the bond market.
"While it may take more time than expected, Japan will see inflation gradually accelerate toward 2 percent", it said.
The central bank has failed to break Japan's entrenched deflationary mindset despite years of heavy money printing, with stubbornly soft inflation sapping its ammunition and global trade woes clouding the outlook for an export-reliant economy.
A loose pledge to increase government bond holdings by about 80 trillion yen annually remained, though it added that it will conduct purchases in a "flexible manner".
"There's a lot of money and speculation piled into the FAANG stocks, and now that money is coming out", said Wayne Kaufman, chief market analyst at Phoenix Financial Services in NY.
Investors await policy meetings of the U.S. Federal Reserve on Wednesday and the Bank of England on Thursday. Articles appear on euronews.com for a limited time.