* Sterling pulls away from 2-week lows as BoE awaited
* Yen off overnight low as hopes fade for drastic BOJ easing
* BOJ, Fed will both hold policy meetings on Sep 20-21
TOKYO, Sept 15 The dollar edged up in early
Asian trade on Thursday, though major currency pairs remained
hamstrung ahead of next week's Bank of Japan and Federal Reserve
The yen was off its overnight lows on fading expectations of
drastic easing steps from the BOJ. Sources familiar with the
BOJ's thinking said the central bank will consider making
negative interest rates the focus of its future easing by
shifting its prime policy target to interest rates from base
There is no consensus in the BOJ yet on whether to deepen
negative rates at the Sept. 20-21 meeting, when it conducts the
comprehensive assessment of its policies, the sources said.
The Fed will also meet on those days, and contrasting
comments from U.S. policymakers have led to uncertainty about
the monetary outlook.
While U.S. interest rate futures indicate expectations for
an actual rate increase next week remain low, the dollar could
get a lift from anything in the Fed's statement that hints at a
hike this year.
Concerns about the policy effectiveness of the world's major
central banks have triggered a steepening trend in bond yields
in recent sessions. A downturn in risk sentiment has bolstered
the Japanese currency due to its perceived safe-haven status.
The dollar edged up 0.1 percent to 102.51 yen, but
remained well shy of a one-week high of 103.35 touched
"I was a bit surprised yesterday. I thought the yen might
have been a little stronger, due to the risk-off mood," said
Masashi Murata, currency strategist for Brown Brothers Harriman
"But maybe the BOJ news had an effect. It's hard to say what
will happen next week," he said.
The euro was steady at $1.1246, and also against its
Japanese counterpart at 115.25 yen.
The dollar index, which tracks the U.S. unit against a basket
of six major rivals, was slightly higher at 95.331, after
a week of wobbly trade which say it hit a Monday low of 94.935
and a session high on Tuesday at 95.672.
Sterling added 0.2 percent to $1.3266, moving away
from a two-week low of $1.3139 hit overnight, as investors
awaited a Bank of England policy meeting later on Thursday.
The BoE is not expected to introduce new measures, having
last month cut interest rates to record lows and reintroduced an
"Chances are pretty slim that the Bank of England will
double down on last month's stimulus following generally robust
UK economic data between the meetings," Jasper Lawler, market
analyst at CMC Markets, said in a note.
(Reporting by Lisa Twaronite; Editing by Shri Navaratnam)