Dollar steadies ahead of central bank meetings

TOKYO, May 8 (Reuters) The dollar was little changed against major currencies on Tuesday ahead of three central bank meetings that may underscore market expectations for U.S.

interest rates to fall this year as rates in other major economies rise.

While the Federal Reserve is seen holding benchmark short-term rates at 5.25 percent after its meeting on Wednesday, analysts say officials may concede signs of slower U.S. growth after recent data revealed anaemic job growth in April, weighing on the dollar.

''The market will focus on the Fed's outlook on the U.S.

economy which is very unclear at this point,'' said Kengo Suzuki, a currency strategist at Shinko Securities.

''Given the soft jobs data last week, the market may react to sell the dollar further if the Fed implies concern about a slowing economy,'' Suzuki said.

The dollar fell modestly in thin trading on Monday as British markets were closed for a holiday.

The euro was traded at $1.3598 unchanged from late New York but still near a lifetime high above $1.3680.

The European Central Bank is expected to hold rates steady at 3.75 percent on Thursday but to signal a hike in June.

Traders said sanguine comments about euro's strength from European finance ministers on Monday gave some support to the single currency in addition to the euro's advantage of a higher interest rate outlook. Against the yen, the euro was quoted at 163.23 yen hovering in sight of a record high of 163.60 yen hit last week.

The dollar was quoted at 120.06 yen and sterling was little changed at $1.9931 The Bank of England is expected to lift rates to 5.5 percent on Thursday, a move that would put British interest rates above those in the United States.

The Canadian dollar, which hit an 11-month high against the U.S. dollar on Monday, stabilised in early trade in Tokyo at C$1.1024. The Canadian dollar rose on a news of a $27 billion bid for Canadian aluminium maker Alcan Inc. and hit a high of $1.1007.

Investors will watch for Australian retail sales for March due at 0130 GMT. Economists expect an increase of 0.5 percent from the previous month. The Australian dollar was traded at $0.8245 little changed from late U.S. dealings.

Reuters SBA VP0625