The connection is lost and no syncing is possible. The problem is known as issue 40065.

Starting in November and running to February 1st, there have been complaints about Wi-Fi just cutting off and not working despite normal signal strength.
An XDA forum thread called "Wi-Fi network connectivity issues and a possible fix," started at the end of 2012 detailed a workaround for the Wi-Fi problem with the Google Nexus 4.
For more details, please visit Google Code site, XDA Forums.
Via
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