* Dlr gains vs yen on better-than-expected jobless data
* ECB keeps rates at 1.0 pct, sees gradual recovery in 2010
* Sterling falls after BoE holds interest rates, expands QE
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By Vivianne Rodrigues
NEW YORK, Aug 6 (Reuters) - The dollar rose versus the yen on Thursday as a government report showing a sharp drop in U.S. jobless claims boosted views that the labor market and the economy were stabilizing.
Meanwhile, sterling fell after the Bank of England said it would extend quantitative easing, and the euro was little changed against the dollar after the European Central Bank kept interest rates unchanged and said it sees a gradual recovery in 2010.
U.S. stocks opened higher and bond prices slipped after the Labor Department said initial claims for unemployment benefits fell to a seasonally adjusted 550,000 in the week ended August 1 from 588,000 the prior week. Analysts polled by Reuters had forecast new claims to edge down to 580,000.
Analysts said the report also helped boost risk appetite and may bode well for July non-farm payrolls data due out on Friday. Still, trading may be volatile ahead of the release of the figures, they warned.
"We had ... a pretty decent number on the initial jobless claims. That boosted risk appetite to some extent," said Samarjit Shankar, a director of global strategy at the Bank of New York Mellon in Boston.
"There's a lot of hesitation ahead of the big nonfarm payrolls number tomorrow, he added.
In morning trading in New York, the dollar was up 0.8 percent at 95.70 yen.
The euro traded 0.2 percent lower at $1.4380. It pared its losses slightly after ECB President Jean-Claude Trichet said that "looking ahead into next year, after a phase of stabilization, a gradual recovery with positive ... growth rates is expected."
The BoE held interest rates at a record low 0.5 percent, and said it expected to take three months to use up the new funds, and the scale of quantitative easing would be kept under review.
"The BoE extended their quantitative easing program, which suggests that the UK economy is still not out of the woods," Shankar said.
Sterling traded at $1.6855. Following the BoE announcement, it fell nearly 1 percent on the day to $1.6827, retreating from the day's high of $1.7029, according to Reuters data.
(Additional reporting by Wanfeng Zhou in New York) (Editing by Theodore d'Afflisio)