The US dollar was lower against the yen and euro in midafternoon trade here Wednesday, with few leads in sight to spur activity and trades remaining thin given the July 4 holiday in the US. CMC Markets chief analyst Ashraf Laidi said the US dollar's weakness of late originated from the combination of prolonged risk-seeking carry trades and overall deteriorating sentiment towards the greenback. This has resulted in the Australian and New Zealand currencies rising to multi-year highs against the US unit while also pushing the UK sterling to fresh 26-year highs. Laidi said there is speculation the Bank of England could raise interest rates by 50 basis points on Thursday as opposed to the market forecast for a 25-basis-point tightening. "We expect the BoE to raise (rates) by 25 basis points to 5.75 percent, a decision that may see only limited pullback in the sterling as traders sit tight ahead of Friday's non-farm payrolls report from the US," he said. Meanwhile, the Australian dollar advanced from this morning's level following the widely expected decision from the Reserve Bank of Australia to keep the official cash rate at 6.25 percent for the seventh consecutive meeting. ANZ Bank senior strategist Tony Morriss said bond yield differentials and firmer metal prices are supporting the Australian dollar. He said while the risks are clearly for the currency to move higher, the thin trading due to tonight's US holiday have probably exaggerated the recent move above 0.8500 US dollar. "We would expect the 0.8600 usd level to provide some near-term resistance for the Australian dollar. A break above 0.8600 usd would open the way for a move in the Australian currency towards 1989 highs as far as 0.8950 usd," he said. Data releases which may influence the currency market later tonight include the June euro zone and UK purchasing manager surveys (PMIs) for services, as well as the euro zone retail sales for May and the latest Bank of England mortgage equity report.