SINGAPORE/LONDON, June 17 (Reuters) - The dollar slipped slightly against a range of currencies on Tuesday including the yen, which strengthened following the Bank of Japan's (BOJ) rate decision.
Broader risk sentiment remained fragile with the Israel-Iran conflict entering its fifth day.
The BOJ delivered little surprise to markets at the conclusion of its two-day monetary policy meeting, as it stood pat on rates and laid out a new plan to decelerate the pace of its balance sheet drawdown next year in the face of rising risks such as the Middle East conflict and U.S. tariffs.
The yen swung between losses and gains after the decision, turning negative during Governor Kazuo Ueda's press conference, but the dollar was last down around 0.1% on the yen at 144.65 yen.
"The BOJ still has a huge amount of (Japanese government bonds) and it's not decreasing that much. So in that case, the slowdown of the purchasing pace is probably partly because of the volatile market for JGBs and also the uncertainty over the global economy," said Tohru Sasaki, chief strategist at Fukuoka Financial Group.
Japanese Prime Minister Shigeru Ishiba and U.S. President Donald Trump have yet to reach a trade deal.
Developments in the Middle East are keeping the mood tense, with U.S. President Donald Trump on Tuesday saying he wanted a "real end" to the nuclear dispute with Iran, and indicating he may send senior American officials to meet with the Islamic Republic.
It follows news on Monday from the White House that Trump was leaving the Group of Seven summit in Canada a day early due to the situation in the Middle East, as the president has requested that the national security council be prepared in the situation room.
"Even though Israel and Iran are attacking each other, I'd say the market is a bit numb to this conflict, at least regarding the FX market," said Michael Pfister, FX analyst at Commerzbank, highlighting that moves last Friday were not that severe, even though the news would usually warrant a huge risk off move to safe havens.
"A lot of people ask whether this is an argument for the continued USD safe haven status, but against other currencies like the Canadian dollar and Norwegian krone, which usually suffer in these risk off environments, the dollar was not able to benefit," he said.
It is more the price of oil that is behind the dollar moves, he said. The escalations have sent the price of Brent crude higher.
Elsewhere, the euro was marginally firmer at $1.1569.
The pound was last down 0.1% against the dollar at $1.35640 . Trump signed an agreement on Monday formally lowering some tariffs on imports from Britain as the countries continue working toward a formal trade deal.
The risk-sensitive Australian dollar was up 0.22% at $0.6539. Meanwhile, against a basket of currencies, the dollar was off 0.1% at 98.124.
The Federal Reserve's policy decision on Wednesday is taking centre stage for FX market watchers. Expectations are for the central bank to keep rates on hold, though the focus will be on any guidance regarding the rate outlook.
Investors also looked ahead to other central bank decisions including from the Bank of England (BoE) and Sweden's Riksbank later this week to guide the next move in markets.
Reporting by Rae Wee and Lucy Raitano in London; Editing by Sam Holmes, Shri Navaratnam, Kim Coghill and Saad Sayeed
