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people would like to know what the ECB position is as regards

Euro drops ahead of ECB meeting

But broader trend for further gains intact

Yen remains weak

NEW YORK, Feb 6 (Reuters) The euro slipped on Wednesday, with traders becoming cautious ahead of the canada goose store European Central Bank meeting on Thursday in the event that ECB President Mario Draghi expresses concern about the high level of the euro.

Most analysts believe Draghi will avoid commenting on the currency but rather recognize uk canada goose outlet the Canada Goose online improvement in canada goose clearance the euro zone outlook and in market sentiment while acknowledging the region still faces many hurdles.

Still, the extent of nervousness was shown when the euro pared losses on Wednesday on comments by German government spokesman Steffen Seibert who said the euro was not overvalued and that long term competitiveness could not be achieved via exchange rates.

Traders said the euro was likely to be sold on any rallies ahead of Thursday ECB meeting, but it could resume its recent rise afterwards.

focus is speculation over tomorrow canada goose coats on sale ECB statement and President Draghi press conference, said Camilla Sutton, chief currency strategist at Scotia Capital in Toronto. expect President Draghi to sound notably cautious and EUR to weaken on the back of it.

The euro was down 0.5 percent at $1.3512, edging away from last week peak canada goose uk black friday of $1.3711, its highest since November 2011, with political uncertainty in Spain and Italy also weighing.

Against the yen the euro was down 0.6 percent canada goose uk outlet at 126.44 yen, canada goose factory sale off a 34 month peak of 127.69 touched in Asian trade, with the yen remaining under selling pressure on expectations of aggressive monetary easing in Japan.

French President canada goose clearance sale Francois Hollande called on Tuesday for a target exchange rate to protect the currency from movements although the idea ran into immediate opposition from Germany.

The ECB is expected to leave interest rates on hold on Thursday and the focus canada goose coats will be on Draghi subsequent news conference.

market is a Canada Goose Outlet bit nervous ahead of the ECB meeting. people would like to know what the ECB position is as regards Hollande comments, said cheap canada goose uk Antje Praefcke, currency strategist at Commerzbank in Frankfurt.

She said buy canada goose jacket she expected Draghi to be cautious and avoid commenting directly on the currency, although Canada Goose Jackets he was likely to face questions about it. If Draghi did comment on the potentially harmful impact of a stronger euro, however, it could Canada Goose Online be seen by the Canada Goose Coats On Sale market as a kind of verbal intervention.

Analysts at Deutsche Bank canadian goose jacket said they were more neutral buy canada goose jacket cheap on euro/dollar, though they still expect a $1.35 $1.40 range for the rest of the first quarter.

The euro is up 2.4 percent this year to date against cheap Canada Goose the Canada Goose Parka dollar.

Banks have been repaying the ECB ultra cheap three year loans. Federal Reserve and the Bank of Japan are expanding their balance sheets.

WEAK YEN The dollar was last little changed on the day at 93.56 against the yen like web Canada Goose Outlet , after reaching a peak of 94.06 in Asian trade, its highest since May, 2010. Traders reported hedging related demand and buying by longer term investors, with supporting bids at 93.50 yen.

News on Tuesday that current Bank of Japan Governor Masaaki Shirakawa will uk canada goose step down three weeks earlier canada goose than planned spurred the latest bout of yen selling.

Japanese Prime Minister Shinzo Abe, who has put the BOJ under pressure to do more to spur the economy, has made Canada Goose sale it clear he wants a governor who will be bold in easing monetary policy.

far as Japan is concerned they are exceeding market expectations with the pace of canada goose uk shop policy implementation and that going to keep the yen under pressure, said Ian Stannard, European head of canada goose black friday sale FX strategy at Morgan Stanley in London.

He said Morgan Stanley first quarter forecast of 95 yen was likely to be exceeded, and a test of 98 to 100 yen was now within reach.