* Euro holds steady above 9-month low, awaits ECB policy
* Aussie dollar slides after weak Australian jobs data
(Updates prices, adds comments)
By Masayuki Kitano and Ian Chua
SINGAPORE/SYDNEY, Aug 7 The euro held steady
above a nine-month low on Thursday ahead of a policy review by
the European Central Bank, while the Aussie dollar tumbled after
surprisingly weak Australian jobs data.
The Australian dollar slid 0.8 percent to $0.9284,
nearing a two-month low of $0.9275 set last week.
Although the Australian dollar will probably find some
support at the early August trough of $0.9275, it is likely to
head lower eventually, said Jeffrey Halley, FX trader for Saxo
Capital Markets in Singapore.
"I think the U.S. dollar is strong, and the data coming out
of Australia hasn't been great," he said.
The Aussie dollar took a hit from surprisingly weak
Australian jobs data, which showed that the jobless rate jumped
to a 12-year high of 6.4 percent in July, a disappointing report
that could revive speculation about another cut in interest
Some market participants were sceptical that the weak jobs
data would immediately alter the outlook for Australia's central
bank to keep rates on holds for a while.
The Reserve Bank of Australia had kept its cash rate at a
record low of 2.5 percent on Wednesday, marking a full year
without a change.
The RBA is unlikely to change its policy stance based on one
set of figures, especially since the jobs data is known to be
volatile, said Divya Devesh, FX strategist for Standard
Chartered Bank in Singapore.
"I don't expect to see any change in stance from them. I
still think they will remain neutral in the coming months,"
Moves among major currencies were generally subdued in Asia
ahead of the ECB's policy decision later in the day.
The ECB is expected to leave interest rates on hold as it
assesses the impact of stimulus launched in June, when it cut
interest rates to record lows, became the first major central
bank to charge banks for holding their deposits overnight and
launched a new ultra-cheap, four-year loan programme.
However, weakness in some recent euro zone data coupled with
persistently low inflation in the region should keep alive
market expectations for the bank to eventually turn to
Markets will be looking at how ECB President Mario Draghi
characterises the present state of the economy, given the risks
to Germany's economy are rising and the effect of Russian
sanctions and geopolitical risk may have lowered the ECB's
"An acknowledgement may be enough to send EUR lower, but the
bigger risk is if they see these factors as only minimal or
temporary. That may have a bigger positive impact on EUR;
probably short-lived," said Emma Lawson, senior currency
strategist at National Australia Bank in Sydney.
The euro held steady at $1.3387. On Wednesday, it had
skidded to as low as $1.3333, its lowest level since last
November as disappointing data from Italy and Germany soured
sentiment toward the single currency.
Italy unexpectedly slid back into recession in the second
quarter, while German industrial orders in June posted their
biggest monthly fall since September 2011.
Against the yen, the euro edged up 0.1 percent to 136.81 yen
, staying above an eight-month low of 136.16 yen
struck on Wednesday.
The dollar inched up 0.1 percent to about 102.19 yen,
getting a breather after the previous day's choppy moves.
On Wednesday, the greenback had dropped suddenly to a 1-1/2
week low near 101.76 yen from around 102.30 in a matter of a few
minutes, prompting talk of a fat-finger trade, or a large order
that created some indigestion.
(Editing by Eric Meijer and Simon Cameron-Moore)