* U.S. private sector shed 169,000 jobs in November
* Yen falls broadly as traders cut long yen positions
* Investors turn focus to ECB, U.S. nonfarm payrolls (Updates prices, adds comment, changes byline, dateline, previous LONDON)
By Wanfeng Zhou
NEW YORK, Dec 2 (Reuters) - The dollar rose on Wednesday after worse-than-expected U.S. private-sector jobs data boosted safe-haven demand, while the yen fell broadly on fears monetary authorities may step in to stem the currency's strength.
The euro slipped ahead of a policy meeting on Thursday of the European Central Bank, which is expected to announce details of how and when it will remove generous liquidity from the system, and could upgrade its economic growth forecasts.
Receding fears over Dubai's debt problems weighed on the safe-haven dollar, but talk of Asian central bank buying and the greenback's gains versus the yen offered broad support.
A report by ADP Employer Services showed the U.S. economy shed 169,000 private-sector jobs in November. While that was fewer than the 195,000 lost in October it was higher than forecasts for a decline of 155,000.
The government releases U.S. November nonfarm payrolls data on Friday.
"Overall ADP is worse than expected, so it could be a negative for risk appetite," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey, "But I have to think that with the ECB tomorrow and U.S. payrolls on Friday we're not going to be going very far today."
In early trading, the dollar stood at 87.21 yen, up 0.7 percent on the day and pulling further away from a 14-year low of 84.82 yen hit on electronic trading platform EBS last week. Traders said a break above 87.50 yen would trigger pre-placed buy orders and herald a stronger push higher.
The euro was up 0.6 percent at 131.47 yen but was down 0.1 percent against the dollar at $1.5073. The euro zone single currency hit a near 16-month high of $1.5145 on EBS last week.
A senior International Monetary Fund official said on Wednesday the euro was on "the strong side" against the dollar, echoing a view expressed in an IMF report on Tuesday.
JAPAN POLICY IN FOCUS
The dollar index, which measures the greenback against a basket of six other major currencies, was up 0.2 percent on the day at 74.514, not far above last week's 16-month low of 74.170.
Bank of Japan measures to combat deflation and keep short-term interest rates down unveiled on Tuesday prompted investors betting on a stronger yen to square positions and take profits.
"We had very strong yen appreciation (recently), and now there's some retracement. Risk appetite is a little bit stronger than it was last week when we had the Dubai news, so investors are taking profits," said Marcus Hettinger, foreign exchange strategist at Credit Suisse in Zurich.
"The BOJ didn't really do anything (major), but the risk is higher now of intervention." The dollar could rise to 90 yen if stocks make further gains, he said.
A BOJ policymaker signaled on Wednesday the Japanese central bank was open to adopting more measures to support the economy following its emergency meeting the previous day that offered extra short-term funding.
The Bank's governor Masaaki Shirakawa said Prime Minister Yukio Hatoyama did not ask him to take additional easing steps when they met, adding they shared the same view on deflation.
Analysts at Barclays Capital said the BOJ's moves this week suggested the bank was willing to ease monetary policy further if needed, adding that this may limit dollar/yen losses. (Additional reporting by Steven C. Johnson in New York and Jamie McGeever in London; Editing by James Dalgleish)