* Euro hovers near 6-month high versus dollar
* Market awaits Fed minutes due later on Wednesday
* Aussie and kiwi remain under pressure
By Masayuki Kitano and Lisa Twaronite
SINGAPORE/TOKYO, Aug 21 - The dollar held steady against the yen and hovered near a half-year low against the euro on Wednesday, as investors awaited minutes of the U.S. Federal Reserve's latest meeting for clues on its policy outlook.
Speculation that the U.S. central bank is poised to begin tapering its $85 billion a month in asset purchases as early as September is generally positive for the dollar, as it tends to lift U.S. Treasury yields. But it can also pressure equities and increase the appeal of perceived safe-haven currencies, such as the yen and Swiss franc.
"We expect the minutes of the July FOMC meeting to show that committee members viewed the improvement in labour markets and reduced downside risk as sufficient to signal that many on the committee stand ready to reduce the pace of purchases in September, should current trends continue," strategists at Barclays wrote in a note to clients.
"Overall, we expect the minutes to maintain the bifurcated message of recent Fed communications: sounding hawkish on tapering and dovish on rate hikes," they said.
The minutes of the Fed's July meeting are due to be released later on Wednesday.
The dollar held steady at about 97.28 yen, staying above a one-week low of 96.91 yen hit on Tuesday on trading platform EBS.
The euro was steady at $1.3423. On Tuesday, the euro had set a six-month high of $1.3453 as the yield premium that 10-year U.S. Treasury notes offer over German Bunds narrowed.
The 10-year U.S. Treasury yield has come down from a two-year high of 2.90 percent set on Monday, as market expectations that the Fed may soon start scaling back its monetary stimulus roiled emerging markets and added a safe haven bid to U.S. debt.
"I think that the overall move higher in the euro lacks conviction, especially given that the ECB has provided dovish forward guidance," said Sim Moh Siong, FX strategist for Bank of Singapore.
At its policy meeting in early August, the European Central Bank (ECB) had left interest rates at a record low of 0.5 percent and affirmed that they will remain there for some while to come and could yet fall further.
In addition, if the strength in the euro were to hurt euro zone exports and the economy and put an end to upside surprises in European data, that could then dent the single currency, Bank of Singapore's Sim said.
The greenback eased 0.1 percent against the Swiss franc to 0.9165, after tumbling to about 0.9147 on Tuesday, the dollar's lowest level versus the Swiss franc since June 13.
Against a basket of major currencies, the dollar held steady at 80.933.
The Australian and New Zealand dollars fell, dented by weakness in Asian equities.
The New Zealand dollar edged down 0.3 percent to $0.7939 , having fallen more than 1 percent in the previous session after the Reserve Bank of New Zealand announced home lending restrictions and said the kiwi dollar was overvalued.
The Australian dollar slipped 0.4 percent to $0.9037 , dented by weakness in Asian equities. The Australian dollar was again being sold by investors as a hedge against weakness in Asian markets.