TOKYO (AFX-ASIA) - The dollar was top-heavy against the yen in midafternoon trading due to the sustained firm performance of the local equity market, dealers said. Caution ahead of the US Federal Open Market Committee meeting later today and the announcement tomorrow of a policy directive at the Bank of Japan's two-day policy board meeting also limited the dollar's top-side, they said. The US' Council of Economic Advisers chairman Glenn Hubbard said today the Bank of Japan should keep up its monetary easing, while the government must push forward with resolving the bad-loan problem and restructuring the economy. The council advises the US president on the economy. Japan's Finance Minister Masajuro Shiokawa, meantime, said the government will not urge the central bank to ease further, but added that he hopes the Bank of Japan will maintain the monetary policy decision made at its last meeting. Yasuda Trust and Banking foreign exchange assistant manager Takashi Fujieda said, however, these policy events are not likely to have any lasting impact on the trend of the dollar/yen, adding that people are now watching more closely the performance of the Japanese equity market. "The sharp downturn of the dollar originally began after a tougher rule on short-selling was introduced in Japan, and the most recent rebound of the dollar came as the impact of this regulation faded," Fujieda said. "Given the waning impact of such regulations on the investment stance of foreign investors, the yen is not likely to resume any sharp appreciation at least before the end of this month." Fujieda said he expects the dollar to be traded in the 128.50-132.50 yen range in the near-term. The euro was little changed against the dollar ahead of the US FOMC meeting later today, dealers said. "The euro is not likely to make any drastic movement before the Easter Holiday is out of the way," Fujieda said.