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Euro, yen steady vs. dollar before central banks

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Shutterstock photo - The dollar was steady against the euro and the yen on Wednesday as investors remained cautious ahead of rate announcements by the European Central Bank and Bank of Japan on Thursday.

During European late morning trade, the dollar was trading close to four-month highs against the euro, with EUR/USD inching up 0.02% to 1.2821.

The single currency remained under pressure after weak manufacturing and employment data from the euro zone on Tuesday fuelled concerns over the outlook for first quarter growth.

Earlier Wednesday, preliminary data showed that consumer inflation in the currency bloc ticked down to 1.7% in March from 1.8% in February, still slightly above forecasts for inflation of 1.6%.

The ECB was not expected to announce any changes to monetary policy on Thursday, but investors were awaiting comments from President Mario Draghi at the bank's post-policy meeting press conference.

The dollar edged higher against the yen, with USD/JPY easing up 0.08% to 93.49.

Expectations for aggressive easing measures by the BoJ under new Governor Haruhiko Kuroda remained intact ahead of the bank's policy statement on Thursday.

The dollar was little changed against the pound, with GBP/USD inching up 0.09% to 1.5109.

The pound briefly touched session lows after data showed that the U.K. construction sector remained in contraction territory for the fifth successive month in March.

The Markit U.K. construction purchasing managers' index ticked up to 47.2 from 46.8 in February, still below the 50 mark that separates growth from contraction and undershooting forecasts for a reading of 47.5.

The dollar was almost unchanged against the Swiss franc, with USD/CHF inching down 0.06% to 0.9485.

The greenback slipped lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.07% to 1.0139, AUD/USD rising 0.22% to 1.0472 and NZD/USD easing up 0.17% to 0.8431.

In Australia, official data showed that the trade deficit narrowed to AUD178 million in February from a deficit of AUD1.2 billion the previous month, compared to expectations for a deficit of AUD1 billion.

Elsewhere data showed that China's HSBC's services PMI rose to a six-month high of 54.3 in March, while the official version of the services PMI rose to 55.6 in March from 54.5 in February.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, edged down 0.04% to 83.07.

The U.S. was to release the ADP nonfarm payrolls report later Wednesday, while the Institute of Supply Management was release a report on U.S. service sector activity. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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