SINGAPORE, Aug. 5 (MNI) - The U.S. dollar continued to trade with a mixed tone through the Asian afternoon Thursday, holding steady against the yen, while the euro was pressed back near near the bottom of its intraday range, ahead of the European Central Bank decision. The dollar this morning retraced some of its overnight gains on the yen, as yen crosses also eased back from New York highs. But trade in the afternoon thinned out further as market players settled back for the ECB meeting. Both the Bank of England and the ECB are set to hold rate meetings Thursday, though both are expected to keep rates unchanged. "We do not expect any change in ECB policy and ECB President Trichet should be cautious in tempering any enthusiasm from recent data as we think monetary policy will have to remain accommodative into 2011," said UBS analysts. "His comments on the recent bank stress test results, if any, will garner attention." Ahead of that, euro-dollar spent a quiet morning session in a tight range between $1.3144 and $1.3175 in Asia, and was quoted near that low at $1.3150 just before midday here. Through the afternoon, euro-dollar remained under pressure and retreated further to fresh session lows, to trade near $1.3130 in late Asian trade, down from $1.3170 near the U.S. close overnight. "Despite yesterdays setback, euro-dollar is still comfortably trending higher in an appreciation price channel currently seen between $1.2960 and $1.3310," noted DBS Bank analysts. In other currency pairs, dollar-yen started the day in a tight Y86.23 to Y86.46 range after strengthening overnight in the U.S. session to a Y86.38 high, courtesy of dollar-supportive U.S. economic data releases. "The dollar finally recovered some ground as stronger data on employment and Service Industry growth allayed concern the economy is slowing sharply enough to force the Fed back into quantitative easing," said analysts at LGT Bank. Dollar-yen eased back further in a relatively subdued Asian morning to hit a Y86.09 low, as yen crosses also retreated, as seen in euro-yen's drop back to a late morning low of Y113.14 from the initial Y113.84 high. Dealers noted early dollar-yen offers from Y86.60/90 and at Y87.00 kept the pair trading with a heavy tone through the morning, despite talk of bids at Y86.15/00, Y85.80, and amid repeated warnings by Japanese government officials about the ills of the strengthening yen. Dollar-yen was at Y86.09 as the morning ended here, and managed to claw back a few points to trade around Y86.26 in the afternoon, about unchanged from Y86.30 in late U.S. trade overnight while euro-yen was at Y113.35, also lower than Y113.65 overnight. "The U.S. dollar took a breather yesterday on the back of slightly better than expected ISM services sector and ADP jobs data," said analysts at United Overseas Bank. "The general uncertainty ahead of the key U.S. labor market data due on Friday and the FOMC meeting next week may have also led to some profit taking on short dollar positions." iahmad@marketnews.com ** Market News International Singapore Newsroom: 65-6304 5258 **

Source