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FOREX-Yen edges up, Aussie dips before jobs data

Published 03/10/2010, 07:29 PM
Updated 03/10/2010, 07:32 PM

* Market awaits Aussie employment report, slew of China data

* RBNZ keeps rates steady, reiterates to hold till mid-year

* Speculation of BOJ loosening monetary policy persists

By Kaori Kaneko

TOKYO, March 11 (Reuters) - The yen trimmed some of the losses suffered the previous day as investors took profits in other major currencies, while the Australian dollar dipped before Australia's jobs report and data on the Chinese economy.

But gains in the yen were expected to be limited due to ongoing speculation that the Bank of Japan may ease policy further as it remains under government pressure to help pull the country out of grinding deflation.

The Australian dollar dipped but hovered near a seven-week high against the dollar before Australia announces its employment report for February at 0030 GMT.

The New Zealand dollar slipped after the Reserve Bank of New Zealand (RBNZ) kept interest rates steady at a record low and reaffirmed plans to hold them there until around the middle of the year, disappointing some who had expected an earlier move.

Market also focused on a slew of Chinese data for February including consumer inflation data, industrial production, retail sales and urban fixed-asset investment on Thursday, after data showed Chinese exports and imports blew past expectations the previous day.

"Risk appetite improved a little after higher commodity prices and gains in overseas stocks, but currency price action will be subdued before the data from Australia and China," said a trader at a Japanese bank.

"Among a batch of data today, the focus will especially be China's inflation-related data. If numbers are too strong, that may increase market speculation about possible monetary tightening by China and could cap the upside of high yielders," he said.

The Australian dollar slipped 0.1 percent to $0.9138, having risen as far as $0.9193 on Wednesday, its highest since Jan. 20, according to Reuters data.

The kiwi dipped 0.1 percent to $0.7012 after the New Zealand central bank's monetary decision. Separately, RBNZ Governor Alan Bollard told Reuters the central bank has time on its side and may not need to raise interest rates as high as previous cycles.

The dollar held steady around 90.50 yen, having climbed as far as 90.83 on trading platform EBS on Wednesday, its highest in two weeks.

The euro was trading around $1.3650, having risen 0.4 percent on Wednesday. Sterling dipped 0.1 percent to $1.4971 after an unexpected drop in British industrial production data for January released the previous day.

(Additional reporting by Anirban Nag in Sydney; Editing by Nathan Layne)

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