TOKYO, Sept 28 (Reuters) - The dollar steadied against the yen on Thursday, clinging to the previous session’s gains as traders looked to upcoming data to gauge whether the Federal Reserve’s next move will be to cut interest rates.

The dollar has gained buoyancy this week, helped by some upbeat data that provided some reassurance about the outlook for the U.S. economy, analysts said.

“I think there has been some revision to pessimistic views about the U.S. (economy),” said Toru Umemoto, chief forex strategist for Barclays Capital in Japan.

Umemoto said sentiment for the dollar has been bolstered by the likes of stronger-than-expected consumer confidence data released on Tuesday, but he added that market players would likely remain cautious on the outlook for the economy.

Overall, U.S. data this week has been mixed.

Figures released on Wednesday showed that sales of new homes unexpectedly rose in August after July sales came in much weaker than first thought, while new orders for durable goods declined.

Upcoming economic reports, including a final reading for second-quarter growth on Thursday and a key inflation report on Friday, may give the dollar a clearer direction and provide more clues to investors about the course for U.S. rates.

In early Tokyo trade, the dollar was at 117.45 yen , holding near late U.S. levels on Wednesday, when the dollar rose around 0.4 percent, helped by unwinding of short dollar positions. The euro edged up to $1.2715 , still off its high so far this week around $1.2820.

The dollar showed little initial reaction to comments by Richmond Fed President Jeffrey Lacker, who said the economy was on solid ground, inflation was still a worry, and that he had wanted another rate hike last week to keep prices at bay.

“The question is how are we going to bring about restoring price stability,” he told Reuters in an interview on Wednesday.

Lacker was the sole dissenter in the central bank’s decision last week to hold rates steady at 5.25 percent

TOKYO, Sept 25 (Reuters) - The dollar steadied against the yen and the euro on Monday, gaining a respite after it slipped last week on concerns that a slowing U.S. economy could prompt the Federal Reserve to cut interest rates next year.

The dollar has come under pressure after the monthly Philadelphia Fed report on business activity released late last week showed the first negative reading in more than three years. The data fanned expectations that the Federal Reserve, which held rates at 5.25 percent at a policy meeting last week, may start cutting rates next year, if not earlier.

“There has been speculation among some market players about a rate cut (in the future) and that has led to dollar selling,” said a trader for a Japanese trust bank.

But the U.S. currency could get continued support in Tokyo trading from dollar buying by Japanese importers, said a dealer at another Japanese bank.

The dollar was at 116.55 yen in early Tokyo trade, little changed from the level in late U.S. trading on Friday, when it slipped to two-week lows against both the yen and the euro.

The euro was a tad lower at $1.2785 and 149.00 yen . For clues about the outlook for U.S. rates, the market will focus on a bevy of U.S. data this week including August existing home sales due later this session.

Home sales likely fell to a 6.18 million annual rate from 6.33 million in July, according to the median estimate of economists in a Reuters poll.

Other U.S. data due this week include durable goods and the core PCE for August.

NEW YORK, Sept 22 (Reuters) - The dollar slipped against the euro, and inched up against the yen on Friday, against a backdrop of growing risk aversion in world markets as investors fretted that slowing U.S. economic growth may prompt the Fed to cut interest rates as early as next year.

The greenback rallied against emerging market currencies as investors dumped higher-risk assets amid political uncertainty in Thailand, Hungary, Poland, and Brazil.

But it was the outlook for interest rates that drove the dollar as investors still traded off Thursday’s Philadelphia Federal Reserve Bank report showing the first negative reading in business activity in September in more than three years, indicating a significant drop in manufacturing in the mid-Atlantic region.

“The market is putting a lot of weight into the Philly Fed (data) and the Fed leaving rates unchanged,” said Joe Francomano, vice president of FX at Erste Bank in New York. “The market is making a big bet that the Fed is done.”

By late afternoon in New York, the euro was up 0.1 percent at $1.2789 against the dollar. Against the yen, the euro was up about 0.3 percent at 148.94 yen .

The dollar was up 0.1 percent against the yen at 116.47 yen .It was off the session low at 116.09, but still endured its largest weekly percentage loss against the Japanese currency in two months.

With data suggesting U.S. economic growth is slowing, financial markets are starting to consider the possibility of Federal Reserve interest rate cuts in 2007.

Despite some movement on the back of an on-going debate as to what the Fed will do henceforth, USD/JPY remained in very familiar territory. Its range overnight was 116.97-117.52. London saw 116.97 well ahead of the Fed statement, bouncing thereafter. New York saw another dip to 117.11 post-Fed but also bounced thereafter on headlines suggesting a more hawkish than expected stance and news of a lone dissent for more tightening. USD/JPY traded up to a high of 117.52 in New York, a few ticks above the London high of 117.48. Although USD/JPY is looking rather buoyant at 117.46/48 at writing, heaviness is expected above 117.50 and towards yesterday”s high in Asia of 117.68 and the New York high of 117.79 the day before. To wit, it may be difficult for USD/JPY to trade back above 118.00. Rumors of Japanese semi-official offers up top along with exporter interest above 118.00 will likely tone down any bullishness barring fresh USD-positive or JPY-negative news. Support below looks to have been confirmed in the 116.90-117.00 area, a double bottom now. Ichimoku chart levels also look supportive with the tenkan line at 117.19 today and the kijun line at 116.73.

The yen jumped against the euro and gained versus the dollar in early trade on Monday after the Group of Seven rich countries backed a rise in the Japanese currency to reflect the country’s strengthening economic recovery.

A statement issued after the weekend G7 meeting in Singapore did not mention the yen specifically, but European Central Bank President Jean-Claude Trichet later told reporters that G7 countries agreed the yen would reflect Japan’s economic recovery.

“We can say that the general tone on the euro/yen was a bit stronger than what we had expected,” Tohru Sasaki, chief Japan foreign exchange strategist at JP Morgan in Tokyo, said in a note to clients.

At 2045 GMT, the euro was at 148.23/33 , down about half a yen from 148.86 yen in late U.S. trade on Friday.

The yen was also stronger against the dollar at 117.25/29 yen compared with 117.56 yen.

The euro stood at $1.2642/45 versus $1.2660 .

Europe is wary of a weak yen, which has fallen to a 21-year low when adjusted for inflation, because of concern the euro will have to bear more of the burden of global currency adjustment.

The yen is languishing even though the Bank of Japan, on July 14, showed confidence in the economy by raising interest rates from zero for the first time since 2001.

“We noted that the exit from the zero interest rate policy and that its recovery is now broadly based — we agree that the yen will reflect these developments,” Trichet said.

German Finance Minister Peer Steinbrueck used similar language, suggesting a coordinated message: “The (Japanese) exchange rate should reflect these two developments.”

Japanese Finance Minister Sadakazu Tanigaki also said the yen’s recent drop to record lows against the euro had been a bit “wild”.

“It is too simple to say the yen will rise as the economy improves. But from the broad perspective that currencies should reflect economic fundamentals, that’s probably the case,” Tanigaki said.

The G7 also urged China to let its currency rise faster to help ease imbalances in trade, but analysts said this was in line with expectations.

The G7 had already pointed the finger of blame at China at its previous meeting in April, and officials said the renewed reference on Saturday reflected frustration at the glacial pace of the yuan’s climb.

China is pivotal because, without a sharp rise in the yuan, its Asian neighbours will be reluctant to let their own currencies appreciate for fear of losing competitiveness.

The USD/JPY is back trading near the Friday close as some analysts feel the comments from a few G7 participants regarding JPY weakness will not stem the weak JPY tide. They point out that the JPY was not mentioned in the official communiqu and they feel that Japanese authorities will do little to support the JPY now that the G7 has come and gone.

The USD/JPY dipped below 117.00 in very early trading in a knee-jerk response to the fact that a few delegates including ECB President Trichet made mention of the recent JPY weakness indicating that the fundamentals do not support the extent of the JPY weakening trend. The USD/JPY weakness turned out to be short- lived and we are back trading above 117.50 where it closed on Friday. The 117.75/80 level has been a pivot point in the USD/JPY of late and a break back above 117.80 will put the key 118.10/15 esistance level back into focus. The USD/JPY trades 117.60/65.

NEW YORK, Sept 15 (Reuters) - The dollar rose on Friday to cap its second weekly gain against the euro as dealers tweaked positions ahead of a weekend Group of Seven meeting and shrugged off tame U.S. inflation data.

The euro came under fire throughout the day, particularly against the yen as traders sold the currency aggressively in case G7 officials made fresh appeals for exchange rate flexibility in emerging Asian economies.

In April, the G7 called on China and other Asian countries to let their currencies rise, sparking a 2 percent fall in the dollar against the yen, which is often viewed as a market proxy for the tightly controlled Chinese yuan.

Last week, a German official said yen weakness would be discussed at the Singapore G7 meeting.

Despite the rapid ebb and flow of such speculation, dealers were unwilling to push any of the major currencies beyond the confines of their recent ranges.

In fact, data on Friday afternoon showed speculators almost completely wiped out their positions against the dollar in the week to Sept. 12, while extending their bets against the yen to a record.

“In general, people do not want to be long or short or putting any major positions going into the IMF and G7 and, of course, the Fed meeting next week,” said Dustin Reid, senior currency strategist at ABN AMRO in Chicago.

The euro was down nearly 0.5 percent at $1.2660 , above the session low at $1.2629, which was its lowest level since late July. The currency was also off 0.5 percent at 148.86 yen .

The dollar was little changed on the day against the yen at 117.56 yen after earlier testing a five-month high of around 118.15 yen.

The Federal Reserve is not expected to move interest rates from their current rate of 5.25 percent next week, and officials have cited slowing U.S. growth and softer inflation in coming months as grounds for steadier policy.

This would suggest the dollar should decline against major currencies as its perceived yield advantage wanes.

But, so far, the greenback has not obliged, and the euro has failed to break out of a broad $1.2980-$1.2450 range despite signals from the European Central Bank that interest rates are likely to climb in October and possibly again before year end.

Dealers have been paring back their short dollar positions as many in the market felt these had become overstretched.

Indeed, according to Reuters calculations, Friday’s positioning data from the Commodity Futures Trading Commission showed the total value of the net short dollar position plummeted to $4.2 billion from $15.1 billion in the prior week.

Also, there is a risk that the G7 will issue a communique that does not specifically call for a rise in the value of emerging Asian currencies to avoid a repeat of the sharp decline in the value of the dollar after April’s meeting.

The ECB and the Bank of Japan, meanwhile, have moved more slowly in pushing their own rates up

Traders said that is partly why the dollar gained after data showed U.S. core consumer prices, without energy and food costs, rose just 0.2 percent in August, echoing the Fed’s predictions of slower inflation.

The dollar also hit a 4-1/2 month high against the Swiss franc on Friday and rose nearly half a percent against sterling to reach $1.8782.

The U.S. currency also got a boost from data showing a gain in New York area manufacturing in September.

Taken together with the consumer price index, the news is “consistent with a slew of incoming data that tells us that the third-quarter growth has rebounded and inflation has moderated,” said Michael Woolfolk, senior currency strategist at The Bank of New York.

A rise in the University of Michigan’s preliminary reading on U.S. consumer sentiment in September had little effect on currency prices.

(Additional reporting by Steven C. Johnson)

San Francisco, September 11. Traders see the upward momentum on USD/JPY continuing in Tokyo tonight, tipping gains to the 117.70-90 region though dealers do not see USD/JPY breaking 118.00. USD/JPY is currently at 117.66. Option defense of 118.00 is seen stalling USD/JPY gains. On the downside, support is expected at 117.40 and 117.25 but one bear sees USD/JPY reversing sharply after a failure at 118.00, and tips a push as low as 115.50. This reflects a view held by many traders in NY that the USD is still bearish and that current USD strength is an aberration. However, this is one reason why USD/JPY remains bid and why the USD index could break higher and commodities could remain under pressure with the bulk of the market seemingly positioned one-way.

NEW YORK, Sept 8 (Reuters) - The dollar rose to six-week highs on Friday as dealers aimed at technical targets and positioned for the risk that the Federal Reserve may have to raise interest rates to keep inflation at bay.

Though speakers from the Fed this week have affirmed the decision last month to keep interest rates steady at 5.25 percent, some continue to sound warnings on higher inflation even though economic growth is slowing — keeping the risk alive the Fed could be forced to tighten policy later this year and thereby support the dollar.

“At the margins, some of the recent comments from Fed officials paint a different picture from what is priced into the market,” said Sophia Drossos, currency strategist with Morgan Stanley. “Some of the doves on the FOMC are starting to sound circumspect about upside inflation risks,” she said, referring to the policy-setting Federal Open Market Committee.

The euro was last down 0.5 percent on the day and down 1.37 percent on the week at $1.2665, after triggering large stop-loss orders below $1.2690. It was on pace for its largest weekly decline since early June.

Dealers said option-related bids were keeping the euro steady, but they added that the next significant chart support lies around $1.2570.

Sterling slipped 0.6 percent at $1.8643, after earlier plumbing fresh six-week lows of $1.8629. Against the Swiss franc, the dollar was up 0.5 percent at 1.2488 francs .

Analysts also said that positioning was behind a large part of the dollar’s strength this week, even though the advantage of short-term U.S. bond yields over euro zone yields has waned

“We can sense the enormous size of the short positions in the U.S. dollar at this point, especially relative to the euro, and we can sense a massive shift in the dollar’s favor about to take place,” said Dennis Gartman, an independent investment adviser.

“Attention must be paid!” he wrote in his latest Gartman Letter.

GROUP OF SEVEN UP

Market chatter continued regarding next week’s meeting of the Group of Seven industrial nations in the wake of a comment from a German finance official on Thursday that yen weakness will be on the agenda for discussion.

Although the inclusion of yen weakness on the G7 agenda was not confirmed by officials from other countries, the comment underscores the extent to which European policy makers are uncomfortable with the euro’s exchange rate, particularly against the yen.

“Some of the comments over the last few days show there is a sensitivity to euro strength,” said Morgan Stanley’s Drossos.

The euro was trading around 147.92 yen , having hit a one-month low of 147.57 earlier, according to Reuters data. Euro/yen recently hit record highs of 150.78.

The dollar stood at 116.78 yen , up 0.3 percent in sympathy with the greenback’s strength against European currencies.

The dollar had a muted reaction after U.S. Treasury Secretary Henry Paulson said he was very much in favor of a stronger dollar

TOKYO, Sept 6 (Reuters) - The yen steadied against other major currencies on Wednesday but players were seen likely to keep unwinding record-high yen short positions ahead of key events including the Bank of Japan’s policy meeting later in the week.

Speculation about the BOJ’s future policy and topics that could be discussed at a meeting of Group of Seven finance ministers later this month could support the yen, traders said.

Robust Japanese capital spending data, a key factor determining monetary policy, released earlier in the week has kept alive the possibility that the BOJ could boost interest rates again later in the year after lifting them for the first time in six years in July.

Yen short-covering had accelerated as investors were getting ready to trim huge yen short positions, and traders said such moves were likely to continue for the time being.

The yen briefly inched up to around 116 yen from around 116.06 yen on news that Princess Kiko had given birth to a baby boy — the first male heir to be born into the ancient royal family in more than four decades.

“Yen buying is likely to continue for now as the market shifts its focus to political issues from interest rate differentials and as players feel the need to square positions after piling up huge yen short positions,” said a dealer at a Japanese bank.

The dealer said more players were becoming wary of the risk that speculation about further appreciation of the Chinese yuan could re-emerge ahead of the G7 meeting, which could discuss global imbalance issues.

The Chinese currency has risen to post-revaluation highs this week and given support to the yen, which is often traded as a proxy for the yuan. The dollar was around 116.07 yen , little changed from late in U.S. trade. It fell to a two-week low around 115.57 yen on Tuesday.

The euro traded around 148.78 , also flat from late U.S. trade and off a two-week low of around 148.27 yen hit on Tuesday.

The single currency was trading around $1.2815 .

Some traders said the yen could take a respite from recent rises after a report by the Organisation for Economic Cooperation and Development released on Tuesday.

Japan should avoid raising interest rates until it has more clear-cut evidence that core inflation is firmly in positive territory, the OECD said.

In contrast, the OECD said the Federal Reserve may need to raise interest rates further to ensure price stability and the European Central Bank can afford to raise euro zone rates towards neutral levels now that economic recovery looks solid enough.

“If interest rate differentials remain, it’s easier to buy foreign currencies,” said a dealer at another Japanese bank.

“The market is closely watching when yen interest rates will rise next.”

Traders said they were waiting for BOJ Governor Toshihiko Fukui’s comments on Friday after the policy meeting ends for the central bank’s assessment of core consumer prices, which posted a smaller-than-expected rise in July.