The yen weakened past the key level of 155 versus the dollar after the Bank of Japan kept interest rates steady at its policy meeting.

Japan's currency slid as much as 0.3% against the greenback to 155.27, a level last seen on Nov. 21. That followed a 0.9% slide in the yen on Wednesday after the Federal Reserve cut interest rates while signaling caution over future rate reductions.

The 155 level for the dollar-yen pair is closely watched by strategists, who see a slide to this mark as a potential trigger for verbal intervention from Japanese authorities, and added pressure on the BOJ to hike rates. 

The decision to stand pat was largely priced in by overnight index swaps prior to the meeting and predicted by the majority of economists in a Bloomberg survey. Rate hike bets had receded in recent weeks, contributing to a six-day losing streak in the yen through Monday, its longest stretch of declines versus the dollar since June. BOJ officials saw little cost in waiting before raising interest rates, Bloomberg reported earlier this month, citing people familiar with the matter. 

Currency strategists have pointed to the risk of further vulnerability for the yen ahead if the BOJ decides to keep interest rates unchanged until March or later. 

A key focus for yen watchers will be whether BOJ Governor Kazuo Ueda gives any hints about the next rate hike at his news conference later Thursday. The central bank may face increased pressure to raise rates if the yen's slump continues.

Source: Bloomberg