Tokyo stocks drop ahead of BoJ meeting

Tokyo shares fell on Wednesday despite a broad rally in Asia ahead of key announcements on monetary policy and stimulus from the Bank of Japan and the European Central Bank.
The dollar lost ground against the euro and the yen on the uncertainty, but was buffeted by expectations the US Federal Reserve will raise interest rates this year as the American economy continues to strengthen.
Shares in Tokyo's benchmark Nikkei index fell 0.51 percent in morning trade, while Seoul stocks dropped 0.39 percent.
Hong Kong, however, saw stocks rise 1.12 percent while Shanghai added 1.72 percent and Sydney rose 1.26 percent ahead of the central bank announcements.
"Although we are not expecting anything out of the ordinary from the BoJ today, it will be interesting to see if energy prices are raining on their inflation goals," Evan Lucas, a strategist at IG brokers in Melbourne, wrote in a research note, according to Bloomberg News.
"Further downside in the inflation rate will force the BoJ to rethink its position again."
Japan's central bank starts a two-day meeting on monetary policy Wednesday, while the ECB holds its own much-anticipated meeting on Thursday.
While analysts do not expect any change from the BoJ, experts broadly expect the ECB to announce a bond-buying scheme aimed at kickstarting lending in the struggling eurozone.
Those expectations have hit the euro, which last week fell below $1.1500 for the first time in more than 11 years before recovering slightly.
On Wednesday, the euro fetched $1.1566 compared with $1.1550 in London, while it also fetched 136.85 yen against 137.24 yen.
The dollar was worth 118.32 yen in Asia, against 118.82 a day earlier.
Oil prices moved higher. The US benchmark, West Texas Intermediate for March delivery, climbed 36 cents to $46.83 while Brent crude for March rose 31 cents to $48.30.
Gold fetched $1,295.83 an ounce, against $1,291.31 late Tuesday.