FOREX-Yen slips as risk appetite edges back

(Changes dateline, byline, updates prices, adds quotes)

By Simon Falush

LONDON, Sept 6 (Reuters) - The yen slipped versus the dollar and euro on Thursday and high yielders strengthened as investors became slightly more comfortable with risky positions ahead of an interest rate decision from the European Central Bank.

Investors have moved back into riskier positions after gains in Asian equities and a higher open on Europe's bourses.

"Investors are a bit more upbeat as Asian and European stocks firmed meaning that the low yielding yen is under more pressure," said Kamal Sharma, currency strategist at Bank of America. "Investors seem to be more comfortable with risk, for now."

Eyes are now turning to the European Central Bank's interest rate decision. Expectations of a rate hike from the ECB have diminished since a credit market squeeze that has forced the bank to inject liquidity into the banking system. Most analysts now expect rates to be kept on hold at 4 percent.

Investors will look to post-meeting remarks from ECB President Jean-Claude Trichet for further clues on the outlook for rates and how the bank will deal with the ongoing credit market problems.

"The focus will be on the press conference with people looking to see whether it's likely that the central bank is done hiking altogether," said Daragh Maher, senior currency strategist at Calyon."

At 0804 GMT, the dollar was up 0.15 percent to 115.36 yen <JPY=>. It was steady against the euro at $1.3648 <EUR=>.