TOKYO, Oct 2 (Reuters) The dollar held off record lows against the euro on Tuesday ahead of a wave of economic data and central bank meetings.
The U.S. currency got a lift the previous session as investors trimmed bets against it while U.S. benchmark equity indexes soared, sending the Dow Jones Industrial average up to an all-time high.
The yen was pressured as the market's risk appetite remains strong, with investors returning to carry trades in which they borrow low-yielding currencies like the yen to purchase higher-yielding currencies.
A sharp rise in Tokyo shares in early trade helped such moves.
''Japanese exporters are stepping back from selling the dollar to hedge their overseas earnings as the second half of the business fiscal year has just started. That's helping the yen slide against the dollar a little sharper than usual,'' said a trader at a Japanese trust bank.
Traders said the employment component of the U.S. Institute for Supply Management's manufacturing index, which rose from the previous month, was also positive for the dollar ahead of the U.S. jobs report due on Friday.
The ISM manufacturing index for September fell to 52.0 from 52.9 in August, but the employment index rose to 51.7 from 51.3.
The euro was nearly flat from late U.S. trade on Monday at $1.4235, not far from its all-time high of $1.4283 hit on electronic trading platform EBS on Monday.
The dollar index, a gauge of the greenback's value against a basket of six major currencies, was little changed at 77.925 after rebounding from a lifetime low of 77.657 hit the previous session.
Against the yen, the U.S. currency edged up to 115.75 yen from 115.68 yen in late New York trade, and the euro rose to 164.75 yen from 164.66 yen.
The dollar had been sliding after the Federal Reserve slashed its benchmark interest rates by 50 basis points to 4.75 percent last month to shield the U.S. economy from a slumping housing sector and a credit crisis.
Investors are betting that soft U.S. economic data this week including the ISM's non-manufacturing index and the non-farm payrolls report would prompt the Federal Reserve to further lower interest rates, which would hurt the dollar's yield advantage.
In addition to economic data this week, investors are looking to the outcome of several central bank policy meetings.
The Reserve Bank of Australia holds its policy meeting on Tuesday and is widely expected to keep rates at a decade high of 6.5 percent when it announces its decision on Wednesday.
The Bank of England and the European Central Bank also meet to set policy later this week, while the global financial system remains sensitive to tight liquidity.
Reuters MP VP0735