TOKYO: The euro slipped in Asia Tuesday ahead of a European Central Bank (ECB) meeting later in the week, with a sharp dip in eurozone inflation fuelling speculation of an interest rate cut.
The European single currency fetched $1.3507 and 132.73 yen in Tokyo, compared with $1.3516 and 133.25 yen in US trade Monday.
The euro is well below the $1.38 level last week before data showing inflation hit a four-year low.
The dollar bought 98.30 yen, down from 98.59 yen in New York but still above Tokyo levels on Friday.
Figures showing the 17-nation eurozone drifting toward deflation has sparked expectations that the ECB will have to cut record-low rates or take other easing action on Thursday to boost economic growth
"The market is... increasingly of the view that the ECB might cut rates, possibly as early as the 7 November meeting, after the surprisingly weak recent inflation data out of the eurozone," National Australia Bank said.
Dollar trading was focused on US data releases this week, including October jobs figures and third-quarter economic growth. They come after mixed comments from Federal Reserve officials failed to supply concrete clues about the bank's timeline for winding down its stimulus programme.
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