FOREX-Dollar rises vs yen on BoJ speculation; euro gains

* Speculation of more BoJ easing weighs down yen

* Euro supported on strong demand for Greek bond issue

* Traders take profits on dollar gains ahead of FOMC, GDP (Adds comment, updates prices, changes byline, changes dateline, previous LONDON)

By Wanfeng Zhou

NEW YORK, Jan 25 (Reuters) - The U.S. dollar rose against the yen on Monday as U.S. stocks advanced and on speculation the Bank of Japan may deliver more easing measures to help an economic recovery.

The euro edged higher versus the greenback after an offer of five-year Greek sovereign bonds met strong demand, easing some concerns over the euro zone's credit problems.

The Bank of Japan began its two-day policy board meeting on Monday. While the central bank is expected to keep interest rates unchanged at 0.1 percent, the market will be watching for any hints of extra easing measures. [ID:nTOE60K08J]

"The yen is down against all the currencies on a combination of concerns that the BoJ is about to increase its...easing (measures) and a resumption of carry trades," said T.J. Marta, chief market strategist with Marta on the Markets LLC in Scotch Plains, New Jersey.

U.S. stocks opened higher on Monday and looked set to reverse a three-day sell-off. That helped boost risk appetite, prompting investors to buy higher-yielding assets funded by cheap borrowing in the yen.

In early trading, the dollar was up 0.4 percent at 90.26 yen.

The euro briefly rose above 128.00 yen , moving further away from a nine-month low hit on trading platform EBS on Friday. It last traded at 127.73 yen, up 0.5 percent.

Against the dollar, the euro was up 0.1 percent on the day at $1.4163 after touching a high of $1.4197, according to Reuters data, as bank sources said demand for the Greek issue had reached about 16 billion euros. [ID:nLDE60O11Z]

"I don't think this means we are going to have a meaningful rally in the euro, but the weak holders of euro shorts have clearly been knocked back," said Mark Oswald, FX and rates strategist at Monument Securities.

Greece has been trying to convince markets it can manage its ballooning debts. The syndicated sale of five-year bonds was seen as an important test of investor demand.

Analysts said the pair was also supported as it held above its 14-day moving average around $1.4130.

DOLLAR EASES

Reports embattled Federal Reserve Chairman Ben Bernanke was edging closer to winning confirmation to serve a second term calmed markets, dimming the dollar's safe-haven appeal, after his prospects were seen as shaky last week. [ID:nN24141266]

The dollar also came under pressure as traders booked profits on the currency's recent gains ahead of key events this week, including the Federal Reserve's two-day policy meeting and U.S. fourth-quarter growth data.

"The U.S. dollar is a little bit lower in most of its crosses and that's really a product of some profit-taking on last week's moves and some positioning ahead of the event risk of this week," said Omer Esiner, senior market analyst at Travelex Global Business Payments in Washington.

Analysts said investors would follow developments in U.S. President Barack Obama's crackdown on U.S. banks announced last week as the market gauges its potential impact on the dollar.

The Australian dollar rose 0.5 percent versus the U.S. dollar and New Zealand's currency gained 0.4 percent. Versus a currency basket, the U.S. dollar <.DXY> was flat at 78.250. (Additional reporting by Neal Armstrong; Editing by Andrea Ricci)