The dollar fell on Wednesday as traders look to a Federal Reserve policy meeting for more clues about its timeline for raising interest rates.

The US central bank is expected to leave key rates unchanged after wrapping up its policy-setting meeting later Wednesday, but markets want to see if provides any future guidance.

After the turmoil that hammered world markets at the start of the year, US policymakers have lowered expectations for rate increases in 2016, saying they would closely monitor overseas developments before making a move.

"Market participants are just shuffling by the sidelines before they decide which way to go," Vishnu Varathan, a Singapore-based senior economist at Mizuho Bank, told Bloomberg News.

"They want to look out for whether the (policy committee) will drop the reference to external uncertainties because that will suggest how cautious they want to be about the hike."

Traders have predicted the Fed's next interest rate hike will be towards the end of the year but every utterance from the bank is scrutinised for clues. The central bank lifted rates in December for the first time in almost nine years.

In Tokyo, the dollar slipped to 111.08 yen from 111.31 yen in New York on Tuesday.

The greenback also lost ground against the euro, which rose to $1.1304 from $1.1298, while it also fell against a string of emerging currencies including the South Korean won, Malaysian ringgit and Indonesian rupiah.

The euro weakened to 125.55 yen from 125.76 yen as traders look to the Bank of Japan's two-day meeting, which wraps up Thursday.

Policymakers are widely expected to unleash more stimulus after this month's deadly earthquakes in southern Japan led to factory closures at a time when the world's third-largest economy is already struggling.