The euro was stable against the dollar early in Asia on Thursday after rising overnight, as speculation that Europe would announce credit-easing measures soothed debt contagion worries, analysts said.
The euro fetched 1.3126 dollars in Tokyo morning trade, marginally down from 1.3138 dollars in New York late Wednesday.
The euro edged down to 110.45 yen from 110.59 yen as Japanese exporters sold the common currency after its sharp rise overnight. On Wednesday, the euro was in the 108-yen range in Tokyo.
The dollar was trading at 84.14 yen compared with 84.19 yen in New York, supported by encouraging US economic data including robust payrolls data.
The euro benefited from an easing of concerns that European economies with large fiscal debts would require bailouts, as Spain unveiled new measures to cut costs and revive the country's ailing economy.
Bond market pressures eased on financially vulnerable eurozone states as the spread of interest rates, or yields, on 10-year Portuguese and Spanish bonds narrowed, suggesting an easing in tension.
The turnaround came after turmoil following Sunday's announcement that the EU and the IMF would provide Ireland with 85
billion euros (111 billion dollars) to shore up its banking sector and meet its debt obligations.
The European Central Bank is expected to maintain its main lending rate at a record low level of 1.0 percent at a monetary policy meeting in Frankfurt later Thursday.
But “there is speculation that the ECB may still take some credit-easing action”, said Mizuho Corporate Bank market economist Daisuke Karakama.
There is anticipation that the ECB “will go for monetary easing to help cushion the damage on the eurozone economy, when the region needs to cut back on fiscal spending and tolerate slower economic growth”, he said.
But Karakama said it would take time to solve Europe's sovereign debt problems.
“The euro will fall back below 1.30 (dollars) sooner or later,” he said.
Karakama said the dollar stayed above 84 yen with support from the US economic data released Wednesday.
Payrolls firm ADP said US private-sector employment saw strong gains in November, with payrolls expanding by 93,000 Ä the largest jump in three years. - Sapa-AFP
