Euro-dollar stable ahead of inflation data

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New York - The euro-dollar rate was little changed on Friday ahead of crucial data on eurozone inflation while the yen slipped against the dollar before Japan's sales tax hike takes effect.

At 2100 GMT, the euro rose to $1.3752 from $1.3742 late Thursday, after falling against the dollar for three straight days.

Eyes are on next week's release of new data on eurozone inflation, which if still extremely week, could push the European Central Bank into mulling extraordinary measures to stimulate the economy, such as a quantitative easing program.

“In the very short-term, the euro-US dollar rate may be exposed to some downside bias as markets await the ECB press conference on Thursday,” said Vasileios Gkionakis, head of foreign exchange strategy at UniCredit.

“However, we remain convinced that any potential verbal intervention will not have a lasting effect on the euro, which should resume its upward trend in the medium term as a result of the improvement in the euro area growth outlook.”

The dollar's lack of firm strength was underpinned Friday by fresh data showing US inflation, based on the PCE price index at just 0.9 percent year-on-year in February, far below the Fed's 2.0 percent target for a healthy economy.

The dollar gained against the Japanese currency, however, to 102.80 yen from 102.17 yen, ahead of the April 1 hike in sales taxes that economists worry could slow Japan's economic rebound.

The euro-yen rate was little changed, moving to 141.38 yen per euro from 140.41.

The British pound pushed higher to $1.6637 from $1.6610 Thursday; the dollar was slightly higher at 0.8869 Swiss franc. - Sapa-AFP


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