The dollar dipped against the yen in Asian trading Thursday on profit-taking as players began to feel that expectations about data set for release Friday had already boosted the U.S. currency enough.
The U.S. dollar was trading at 107.12 yen in Tokyo by midafternoon, down 0.15 yen from late Wednesday here and below the 107.51 yen it bought in New York later that day. The euro fell to US$1.2919 from US$1.2966 late Wednesday and to 138.41 yen from 139.10 yen.
The dollar was mostly lower against other regional currencies, edging down to 1,015.4 South Korean won form 1,024.5 the previous day, and to 9,492 Indonesian rupiah from 9,515. But it rose to 54.698 Philippine peso from 54.67.
Traders sold the dollar on growing expectations it won't get much more of a boost from Friday's release of key Japanese and U.S. economic data, because expectations have already played out on the market.
The dollar has rallied lately, but some players are starting to feel that may be over.
On Friday, the Japanese central bank will release the results of its "tankan" quarterly business sentiment survey. Later in the day, the United States will give payrolls data for March.
The tankan is expected to give a weak reading, which tends to help push the dollar higher because of pessimism about the Japanese economy.
U.S. non-farm payrolls are expected to have increased by 225,000 in March, after the economy created 262,000 new jobs in the previous month -- another factor helping push the dollar higher. Optimism about the U.S. economy tends to push the dollar higher.
"A weak tankan result and steady growth in U.S. payrolls have already been factored into market moves," said Minoru Shioiri, senior foreign exchange manager at Mitsubishi Securities.
The March tankan survey is expected to show that corporate sentiment hasn't changed much in the last three months. Economists expect the diffusion index for large manufacturers to remain steady at 22 from the previous survey in December, which would suggest Japan's economic recovery has yet to regain momentum.
Disappointing fourth-quarter U.S. gross domestic product data lifted most currencies against the dollar overnight in New York trading. The report showed that gross domestic product unrevised at 3.8 percent for the quarter, lower than an expected upward revision to 4 percent.
The dollar has recently taken a breather from its rally last week as trading picked up after the Easter holiday.