February 18, 2014 / 12:15 AM / 4 years ago

FOREX-Yen inches down vs. dollar, euro as BOJ awaited

* BOJ expected to hold steady, with focus on Kuroda’s comments

* Aussie dollar pushes higher as RBA minutes awaited

By Lisa Twaronite

TOKYO, Feb 18 (Reuters) - The yen inched down against its major counterparts in early trade on Tuesday, as investors waited to see if the Bank of Japan would hold policy steady as expected and perhaps hint at the possibility of further easing ahead.

The dollar rose about 0.2 percent to 102.10 yen, pulling away from a nearly two-week low of 101.37 yen hit in the previous session, while the euro also added about 0.2 percent on the day to 139.91 yen.

U.S. markets were closed on Monday for the Presidents Day holiday.

The BOJ is expected to stand pat at its two-day meeting and remain committed to increasing base money, its key policy gauge, at an annual pace of 60-70 trillion yen.

But market participants will be waiting to see if Governor Haruhiko Kuroda maintains the stance he took last month, that no further easing was needed now with prices rising steadily and overseas economies recovering, or if he hints at any more steps.

Japan’s gross domestic product data released on Monday showed the economy grew less than expected in the fourth quarter of last year as consumer spending, business investment and exports disappointed -- a worrying sign of waning momentum ahead of April’s planned increase to the national sales tax.

The BOJ monetary policy announcement is likely to be a “non-event” for the yen, since no changes are expected, BK Asset Management managing director Kathy Lien, but the minutes from the last Reserve Bank of Australia meeting could drive the Australian dollar higher.

“Earlier this month, the RBA dropped its bias to ease and the minutes could provide a deeper explanation of their reasoning for doing so,” Lien said in a note.

The Australian dollar was up about 0.1 percent at $0.9036 , not far from the previous session’s one-month high of $0.9069.

The Aussie continued to take support from Chinese lending data on Saturday that suggested Australia’s main export market may not be cooling as much as feared.

Against a basket of currencies, the dollar retook some lost ground. The dollar index fell as low as 79.951 in the previous session, its lowest since late last year, before ticking up to 80.159.

The euro was steady on the day at $1.3704, not far from a high of $1.3723 touched on Monday, its highest level since Jan. 24.

European Central Bank governing council member Ewald Nowotny said on Monday that a negative deposit rate from the ECB may fail to stimulate more lending and could have an adverse psychological effect.

The single currency was helped by data on Friday showing both Germany and France grew slightly faster than expected in the fourth quarter.

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