The dollar was flat against a basket of major currencies yesterday as dealers squared positions ahead of US jobs data later in the day and a meeting of Group of Seven finance chiefs over the weekend.
The euro ro se broadly on a Market News report citing 'well-placed monetary sources' that the European Central Bank was discussing raising interest rates and unwinding its liquidity provision programmes, even though it would not do so for some time.
But trading ranges w ere narrow before the US employment repor t for September at 1230 GMT, the economic indicator that has probably the single biggest impact on financial markets.
At 0940 GMT the euro was up 0.2% on the day at $1.4555, rebounding from a threeweek low of $1.4502 hit earlier in the day.
Dealers reported good demand from Asian reserve managers in the low $1.45s and stronger support at $1.4450, a break of which to the upside in early September was key and so could be equally significant if it gave way on the downside.
Traders also reported options expiries at $1.4550 rolling off later yesterday.
The euro pared losses against the yen to trade flat at 130.15 yen and was up 0.5% against sterling at 91.60 pence.
"While it's prudent for central banks to discuss the possibility of raising rates at some point, (it is) less prudent for any of the big three central banks - the US, UK and euro zone - to move any time in the coming six months," said Lauren Rosborough, senior currency strategist at Westpac in London.
"These comments are being taken too literally," she said, refer ing to the Market News report.
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