The euro edged up against the dollar in thin Tokyo trade Thursday as investors awaited a European Central Bank (ECB) meeting to set interest rates, dealers said.
"Dealers are now waiting for the result of the ECB meeting as a majority of investors expect the bank to raise interest rates by (at least) 0.25 percentage points," said Fuji Bank dealer Yoshiyasu Naruse.
The expectations helped lift the single European currency after it dipped near an all-time low in New York overnight.
The euro traded at $0.8938 around 2:00 p.m. (0500 GMT), up slightly from $0.8932 in New York and 0.8883 in Tokyo late Wednesday.
But investors fear that a hike of half a percentage point in the ECB's "refi" refinancing rate could rebound on the euro by damaging economic growth in Europe, dealers said.
"Many are tipping a 50-basis-point hike," research house IDEAglobal.com said in Singapore.
"If this eventuates, the euro will be sold," it said.
Against the yen, the euro traded at 95.15 at 2:00 p.m. in Tokyo, down slightly from 95.18 in New York but up from 94.41 in Tokyo Wednesday.
The dollar meanwhile was quoted at 106.45-47 yen, down slightly from 106.55 yen in New York but up from 106.22 yen in Tokyo late Wednesday.
"Investors are sidelined ahead of Friday's release of US employment statistics," said Fuji Bank's Naruse. — (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)
