SINGAPORE (Reuters) - The dollar steadied at the start of Asian trade on Thursday ahead of interest rate decisions from the European Central Bank and the Bank of England, both of which are expected to keep rates on hold later in the global day.
The U.S. dollar index , which measures the greenback's strength against a basket of six currencies, was up 0.2% at 96.671, having traded near a two-week high earlier.
The euro was steady at $1.1800 ahead of the European Central Bank decision, where it is expected to keep rates on hold. Investors' attention will be focused on the post-policy press conference to gauge the outlook for rates over the coming months.
"The emphasis will likely be on higher uncertainty," with only minor tweaks in communication, according to analysts from Bank of America, who expect the ECB to hold rates later in the day. "Our conviction in a March cut is not rock solid, but we remain convinced of an easing bias from here."
The British pound was flat at $1.3650 ahead of the Bank of England's policy decision, at which it is also expected to remain on hold.
Against the yen , the U.S. dollar was fetching 156.92 yen, keeping steady as Japan's election campaign enters its final stretch ahead of Sunday's poll.
The dollar has gained some strength this week as financial markets assess U.S. corporate earnings season, now halfway complete, and stocks turn risk-off.
The Nasdaq Composite has fallen 2.9% during the past two days, its biggest slide since October, with volatility triggered by market bellwethers including Google parent Alphabet (GOOGL.O) , which reported aggressive capital expenditure plans alongside its earnings on Wednesday, and a rout in software stocks as they adapt to a new era of generative AI.
As the Asian trading session began, Federal Reserve Governor Lisa Cook said in a speech she is more concerned about stalled progress on inflation than a weakening labour market, a strong signal that she will not support another interest-rate cut until tariff-induced price pressures begin to recede.
Fed funds futures are pricing an implied 90.6% probability that the U.S. central bank will hold rates at its next two-day meeting ending on March 18, unchanged from a day earlier, according to the CME Group's FedWatch tool.
Against the Chinese yuan trading offshore in Hong Kong , the dollar slipped 0.1% to 6.9386 yuan following a phone call between U.S. President Donald Trump and Chinese counterpart Xi Jinping in which they discussed trade, security issues and U.S. arms sales to Taiwan.
The Australian dollar was up 0.1% at $0.70045 following the release of trade balance data which was a little ahead of market estimates. The New Zealand dollar was 0.1% firmer at $0.60045.
Cryptocurrencies stabilised after a selloff which saw digital assets fall to the lowest since November 2024, with bitcoin last up 0.2% at $72,745.23, while ether edged up 1% to $2,146.63.