* Easing by ECB back on radar after Weidmann, Draghi comments
* Yen helped marginally by renewed Ukraine concerns, U.S. data
* Aussie supported by China stimulus hopes, RBA comments
By Hideyuki Sano
TOKYO, March 27 The euro was on the defensive on Thursday after comments from European Central Bank officials this week raised fresh speculation on further monetary easing to stave off potential deflation.
The euro traded at $1.37875, edging near a low of $1.3749 hit twice in recent days, a break of which will bring the currency to its lowest level since March 6.
That was the day when currency posted its biggest jump in the past two months as the ECB refrained from taking any easing steps. The euro's rally went on to a 2 1/2-year high of $1.3967 hit a week later.
But speculation of more stimulus was rekindled after influential ECB governing council member and Bundesbank chief Jens Weidmann said on Tuesday that the central bank could exercise several options to temper euro strength and combat deflation.
Weidmann said negative interest rates were an option and quantitative easing was not out of the question -- surprising investors given the German central bank has consistently viewed quantitative easing critically.
ECB President Mario Draghi also said on the same day the that the central bank stood ready to act if inflation slipped lower than the ECB expected.
These comments put fresh focus on euro zone consumer price data due on Monday, which economists expect to show a subdued inflation of 0.7 percent, below the ECB's annual inflation forecast of 1 percent this year.
"It seems the ECB is concerned about disinflation a bit more than the market had been led to believe. The ECB seems to be trying to adjust market expectations as the euro has gained," said Shin Kadota, chief FX strategist at Barclays.
The euro hit two-week low against sterling in early trade, falling to 0.8311 pound. Against the yen, the single currency fetched 140.60 yen, having erased all its gains since the previous ECB policy meeting.
The yen stood near one-week high against the dollar, drawing some support from renewed concerns over Ukraine after U.S. President Barack Obama's tough talk on Russia as well as some soft spots in U.S. durable goods orders data.
Obama, in a speech in Brussels, said Russia's isolation would deepen and sanctions would expand if the country continued its current course.
Orders for long-lasting U.S. manufactured goods rebounded in February, but a surprise drop in a gauge of planned spending on capital goods pointed to sluggish economic growth this quarter.
The dollar stood at 102.07 yen, having hit one-week low of 101.87 yen on Wednesday.
The Australian dollar, however, stayed firm near a four-month high on hopes of economic stimulus in China and upbeat comments on the economy from Reserve bank of Australia Governor Glenn Stevens on Wednesday.
The Aussie last stood at $0.9216, down slightly from late U.S. levels but not far from Wednesday's high of $0.9245.
Although Stevens said he expects the Aussie to weaken, he noted signs that low rates were working to stimulate demand, and a further period of steady policy was likely. (Editing by Eric Meijer)