* Dollar index pulls further away from 4-1/2-month lows
* Prospects of ECB moving away from easy policy tempered for
* Pound drifts sideways after Britain's triggering of
By Shinichi Saoshiro
TOKYO, March 30 The dollar hovered near a
one-week high against a basket of currencies on Thursday, buoyed
by a weaker euro which sagged as prospects of the European
Central Bank stepping away from monetary easing faded.
The U.S. currency was up 0.1 percent at 111.195 yen,
putting some distance between a four-month low of 110.110
plumbed on Monday.
The euro was a touch lower at $1.0760, having drifted
down from a 4-1/2-month high of $1.0906 scaled on Monday.
The common currency had dropped about 0.5 percent overnight
following a report by Reuters that European Central Bank
policymakers were wary of changing their policy message after
tweaks this month had raised expectations of the central bank
ending its super-easy policy and eventually hiking interest
"The market may have gotten ahead of itself on its
expectations towards the ECB ending its easy policy and the news
helped temper such speculation," said Junichi Ishikawa, senior
FX strategist at IG Securities in Tokyo.
"That said, the ECB seems set on finding a way out of its
easy policy, so it would be difficult for the euro to keep
declining. It is no longer a case of the euro being sold on easy
policy expectations, with German bund yields settled firmly in
The euro was boosted earlier in the month by a report that
the ECB had discussed the possibility of raising interest rates
before the end of its quantitative easing programme.
The dollar index against a group of major currencies was
steady at 100.020 after rising overnight to 100.130, its
highest since March 21.
The greenback was also boosted by Chicago Fed President
Charles Evans, who said he was in line with most of his
colleagues in supporting further rate hikes this year.
The dollar benefited as some of the dust began to settle
after its tumble earlier in the week to 4-1/2-month lows.
The currency slumped on Monday after the U.S. House of
Representatives pulled a bill to overhaul U.S. healthcare
insurance, which knocked the wind out of the dollar-supportive
The pound was little changed at $1.2439 following
choppy moves the previous day.
Sterling swung between $1.2478 and an eight-day low of
$1.2377 on Wednesday before ending the day little changed,
unable to find clear direction from Britain's formal triggering
of its exit from the European Union.
(Reporting by Shinichi Saoshiro; Editing by Eric Meijer)