* Dollar/yen's slide deepens as traders show caution
* Dollar index struggles near 7-mth lows
* Euro's advance vs dollar limited
* Australia's record GDP run continues in Q1
* A$ hits 1-mth high
* Graphic: World FX rates in 2017 tmsnrt.rs/2egbfVh
By Jemima Kelly
LONDON, June 7 The dollar hit a seven-week low
against the yen on Wednesday, with traders cautious a day before
Britain votes, the European Central Bank makes a policy decision
and former FBI director James Comey gives testimony to the U.S.
The dollar has lost more than 1 percent versus the
safe-haven Japanese currency so far this week, pressured by a
sharp drop in U.S. Treasury yields to seven-month lows amid a
risk-averse mood, and as weak U.S. data has curtailed
expectations for interest rate hikes from the Federal Reserve.
On Wednesday the greenback fell 0.2 percent to 109.22 yen
, its weakest since April 21.
"Tomorrow’s what is being dubbed as 'Triple Threat
Thursday',...an event-filled day that could send global markets
on a bumpy ride," said ING currency strategist Viraj Patel, in
Any damaging revelations in Comey's testimony is likely to
further hurt Trump and take the wind out of his plans to roll
back regulations and overhauling the tax system - an agenda that
had sent the dollar to 14-year highs earlier this year.
In Britain, markets are worried that the ruling Conservative
party might not get a majority of seats - an outcome seen
strengthening Britain's hand in its exit talks with the European
Union. Investors had been betting on a solid Conservative win
until two weeks ago, when polls narrowed.
And while the ECB is unlikely to start to wind back its
expansive stimulus programme given waning global inflation
pressures, investors will be keen to hear its stance on the euro
ECB President Mario Draghi said last week that while euro
zone growth may be improving, inflation remains subdued and
still requires substantial stimulus.
Against a basket of currencies, the dollar steadied at
96.649, close to a seven-month low of 96.517 hit the
The euro edged down 0.2 percent to $1.1256 after data
showed German industrial orders dropped far more than expected
in April. The single currency hit a seven-month
high of $1.1285 last week.
"Of the three big events on...Thursday, the ECB meeting
could be the least disruptive as participants have already had
time to curtail their previously hawkish expectations," said
Ayako Sera, senior market economist at Sumitomo Mitsui Trust in
The Australian dollar added 0.6 percent to reach a one-month
high of $0.7555 after data showed the resource-rich
economy grew 0.3 percent in the first quarter, dousing fears
that its record expansion may have ended.
Sterling was 0.1 percent lower at $1.2900.
For Reuters Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Additional reporting by Shinichi Saoshiro in Tokyo; Editing by