The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥90.00 figure and was capped around the ¥90.75 level.  Traders await Bank of Japan Policy Board's interest rate decision tonight with strong expectations of additional monetary easing.  The central bank may expand a ¥10 trillion fund that provides funding to banks when policymakers convene on 16-17 March and this is important because an unlimited uncollateralized loan facility expires on 31 March.  Some BoJ-watchers believe the facility could expand by at least ¥5 trillion. The central bank remains under significant pressure to do more to combat the deflation problem further. Finance minister Kan today reported Fiscal policy focusing on stimulating demand will have some impact against deflation.  The central bank can make an inflationary impact with monetary policy...I want to overcome deflation as soon as possible in cooperation with monetary policies.  National Strategies Minister Sengoku called on the central bank to enact policies that will be positive for production activity, capital investment, and consumer spending.  Former MoF mouthpiece Mr Yan Sakakibara reported deflation is a structural problem that monetary policy cannot remedy.  Data released in Japan overnight saw February machine tool orders climb 217.4% y/y and dealers await the release of January tertiary index data.  The Nikkei 225 stock index lost 0.28% to close at ¥10,721.71.  U.S. dollar offers are cited around the ¥94.75 level.  The euro moved higher vis-à-vis the yen as the single currency tested offers around the ¥124.60 level and was supported around the ¥123.20 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥137.45 level while the Swiss franc moved higher vis-à-vis the yen and tested offers around the ¥85.80 level. In Chinese news, the U.S. dollar depreciated vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8260 in the over-the-counter market, down from CNY 6.8262.  People's Bank of China reported inflation expectations are rising in a quarterly survey released today and this could render it difficult for the government to meet its 3% annual inflation target.  Higher inflation expectations will likely propel interest rates higher.