Euro up against dollar ahead of US Fed meeting

The euro rose against the dollar in Asia on Monday after data showed the US economy grew at a slower rate in January-March than forecast, while eyes are on a key Federal Reserve meeting, analysts said.

The euro fetched $1.3049 in afternoon Asian hours from $1.3029 in late New York trade Friday, while the dollar was changing hands at 97.66 Japanese yen from 97.99 yen.

The single European currency was at 127.44 yen from 127.76 yen on Friday.

The Commerce Department said Friday the world's biggest economy grew 2.5 percent in the first quarter of the year, a solid rebound from the previous three months but slower than expected.

However, the result firmed expectations that the Fed will likely not tighten monetary policy in the near future, as government spending cuts and higher payroll taxes crimp growth.

"Traders are keenly watching out for the outcome of the (policy board) meeting later this week," said Kelly Teoh, market strategist at IG Markets Singapore.

"There is a degree of confidence that there won't be any respite with the quantitative easing policy this year as the global economic outlook still does not look good," she told AFP.

The US central bank's Federal Open Market Committee will meet on Tuesday and Wednesday.

Dealers will also be looking to the European Central Bank's policy meeting on May 2, where there is an expectation of an interest rate cut.

The ECB on Friday published two sets of data showing lending activity in the 17 countries that share the euro remains at very low levels, owing to weak demand and because firms are finding it difficult to obtain financing.

The dollar also lost ground against other major Asian currencies.

It fell to 29.29 Thai baht from 29.32 in Asian trade on Friday, to 1.2349 Singapore dollars from 1.2369, to 41.18 Philippine pesos from 41.20, to 29.568 Taiwan dollars from 29.60, and to 1,107.25 South Korean won from 1,109.25.

It rose to 54.3262 Indian rupees from 54.19 last Friday and to 9,743 Indonesian rupiah from 9,722.

The Australian dollar fell to $1.0327 from $1.10312 and the Chinese yuan fetched 15.85 yen against 16.04 yen.