The dollar made headway against the yen and the euro on Wednesday with the yen pulling off recent highs ahead of the European Central Bank meeting.

The ECB is widely expected to keep interest rates on hold when it meets Thursday

Against the yen, the greenback changed hands at ¥87.78 from ¥87.09 on Tuesday after flirting with ¥88, a two and a half year high.

The euro firmed to ¥114.78 from ¥113.96 as investors bet that the Bank of Japan will take more aggressive stimulus action at its next policy meeting at January 21-22nd.

Newly elected Prime Minister Shinzo Abe has pledged to take decisive measures to boost Japan's economy.

The euro was down against the dollar at $1.3065 from $1.3084 on Tuesday following disappointing German industrial production data for November.

The dollar index, which measures the US currency against a basket of six major currencies, advanced to 80.515 from 80.323 on Tuesday.

The pound fell below $1.60 for the first time in over a month on bets that the Bank of England will signal more stimulus as the economy struggles to recover.

The UK currency also weakened after a government report showed the November trade deficit narrowed less forecast.

The pound later traded at $1.6034 from $1.6053.


CJ

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