Dollar Steady in Asia Before ECB's Meeting

        By Tatsuo Ito
        The dollar was steady against major currencies in Asia on Thursday, as traders refrained from aggressive bets before the European Central Bank's policy council meeting later in the day.
        Better-than-expected economic data from Australia and China, coupled with some recovery in Japan's stock market after Wednesday's heavy loss, weren't enough to improve risk sentiment and trigger broad yen selling.
        Traders instead shifted their focus to the ECB's meeting outcome and subsequent remarks by ECB President Mario Draghi, although no fresh easing is expected.
        "No action from the meeting is the consensus," said Toshiyuki Umekawa, vice president of the forex division at Mizuho Bank. "If that's true, the euro will likely test the upside soon after the rate announcement."
        He added that unless Mr. Draghi says something drastic to put the brakes on the euro's recent upward march, the single currency could climb toward the key $1.4000 mark, a level the ECB seems to want to avoid.
        At 0450 GMT, the euro was at $1.3916 against $1.3913 in late New York on Wednesday.
        Analysts are skeptical that the euro will keep rising above $1.4000.
        Yunosuke Ikeda, head of FX strategy at Nomura Securities, said a rise in the euro to $1.4000 could offer a good chance to sell, as such a level wouldn't be justified in the face of solid U.S. economic fundamentals.
        His firm expects no fresh easing at the ECB's meeting, but a "surprise" rate cut can't be completely ruled out, given that the latest euro zone inflation data undershot expectations.
        "Since the market has already priced in a lack of fresh easing, there may be limited scope for the euro to advance," said Kengo Suzuki, chief forex strategist at Mizuho Securities.
        The dollar was at Y101.84 versus Y101.92, after rising overnight following remarks from U.S. Federal Reserve Chairwoman Janet Yellen.
        While Ms. Yellen wasn't overly concerned about weak growth in the first quarter due to harsh winter weather, she reiterated concerns about slack in the labor market.
        Elsewhere, the Australian dollar rose versus the greenback and the yen after Australian jobs data came in better than expected. Employment rose by 14,200 jobs against a forecasted 9,000, with unemployment steady at 5.8% against a forecast of 5.9%.
        Meanwhile, China's exports rose by 0.9% in April from a year earlier, better than a forecast for a 3.5% fall.
        Write to Tatsuo Ito at tatsuo.ito@wsj.com
        (END) Dow Jones Newswires

        May 08, 2014 01:22 ET (05:22 GMT)