The Japanese yen held steady around 159.3 per dollar on Monday after weakening last week, as markets positioned for the upcoming Bank of Japan policy meeting, where interest rates are widely expected to remain unchanged. However, the central bank may lift its inflation outlook while lowering its growth forecast to reflect the economic impact of the ongoing Middle East conflict. Meanwhile, BOJ Governor Kazuo Ueda will face the challenge of signaling their determination to keep normalizing monetary policy to support the yen, which has come under pressure from surging oil prices due to the Iran war. Last week, Finance Minister Katayama said authorities retain a “free hand” to intervene in currency markets to stabilize the yen, stressing readiness to take “decisive” action against speculative moves.