LONDON, Feb 11 - Hopes that Federal Reserve Chairman Alan Greenspan will present an upbeat view of the U.S. economy failed to boost the dollar on Wednesday, while European stocks shrugged off a positive day on Asian bourses. European government bond yields rose ahead of Greenspan's speech. Crude oil slipped and safe haven gold was flat. Markets were quiet ahead of a key speech to the U.S. congress by Greenspan at 1600 GMT which will be pored over for hints about the timing of an expected rise in U.S. interest rates. The prospect of an early rate rise would help the dollar, down around 18 percent against the euro over the past year. However, too hasty a hike risks crimping U.S. consumer spending, which has kept the world's largest economy powering ahead. Analysts expect Greenspan to tell Congress that U.S. economic prospects are good but that the central bank can be patient before upping interest rates from 1958 lows. "Although we are still in a structurally bearish trend... we are perhaps looking at a pause in the long dollar decline as Greenspan delivers a relatively upbeat testimony," said Adam Cole, senior currency strategist at Credit Agricole Indosuez in London. By 1100 GMT, the dollar was up slightly against the euro at $1.2680 , and below Tuesday's one-month low at $1.2788. It was steady against the yen at 105.55 yen , but remained close to last week's three-year lows around 105.20.
STOCKS, BONDS
European stocks trod water ahead of Greenspan's speech. Equity markets have been dawdling for the past two weeks as investors deemed earnings reports, although generally in line or above expectations, already priced into share valuations, and after disappointing U.S. labour data. "On average, economic data are no longer beating expectations. This is a combination of the forecast 'hurdle' having been raised, but also some genuinely disappointing data," said ABN AMRO economist Matthew Wickens. Surging equity markets have also been given pause by worries that an early rise in U.S. interest rates could smother the current economic recovery.
By 1100 GMT, the FTSE Eurotop 300 index <.FTEU3> was up 0.1 percent at 996 points, within a whisker of January's 17-month high. The DJ Euro Stoxx 50 index <.STOXX50E> was flat at 2882 points. Earlier Asian bourses hit a four-year high <.MSCIAPJ> on enthusiasm over corporate earnings in the region. Tokyo was closed. European government bonds rose ahead of Greenspan's speech. At 1100 GMT, the two-year Schatz yield was up 1.5 basis points at 2.39 percent -- its highest since Friday. The 10-year Bund yield was up 2.0 basis points at 4.16 percent. Crude oil futures dipped after rising sharply on Tuesday after production cartel OPEC agreed to cut production by one million barrels per day at a meeting in Algiers. April Brent Crude was down 19 cents at $29.74 at 1100 GMT. Safe-haven gold was flat at $406.10/$406.60.//