By Vidya Ranganathan
       SINGAPORE, April 22 (Reuters) - The euro and yen were
relatively steady in early Asian trading on Monday and the U.S.
dollar stayed near its highs after last week's hectic policy and
geopolitical developments. 
    Eyes are on the yen this week, with the Bank of
Japan's (BOJ) Friday policy review the notable item on the
economic calendar. 
    The yen hit 154.70 per dollar, not far from last week's
34-year low of 154.79 and close enough to the 155-level that is
next on traders' alerts for possible intervention by Japanese
    The dollar's trade-weighted index was above 106, but
off five-month highs it struck last week after comments from
Federal Reserve officials and a run of hotter-than-expected
inflation data forced a paring back of rate cut expectations.
    A cooling in Middle East tensions, which had driven the
dollar, gold and crude oil prices sharply higher
on Friday and battered stock markets, also helped temper
volatility. Tehran downplayed Israel's retaliatory drone strike
against Iran, in what appeared to be a move aimed at averting
regional escalation.
    "There will be a focus on the BOJ meeting, but it is too
soon for them to alter policy, and the market gives a change in
rates no chance at all," said Chris Weston, head of research at
    Referring to Japanese rates swaps, Weston said he sees "no
change priced for this meeting" but a hike of 10 basis points
priced by July and 25 bps priced by December.
    The strong dollar prevailed at last week's International
Monetary Fund/World Bank spring meetings in Washington too, and
the United States, Japan and South Korea issued a rare joint
statement on the issue. 
    Speaking after the Group of 20 (G20) finance leaders'
meeting in Washington, Bank of Japan Governor Kazuo Ueda said
the Japanese central bank may raise interest rates again if the
yen's declines significantly push up inflation, highlighting the
dilemma the weak currency has become for policymakers.
    The yen has been one of the biggest losers against
the dollar this year, with losses mounting to 9%. 
    Yet, while the rethink on Fed easing has led to a general
repricing of global rate cut timelines, expectations for the
European Central Bank (ECB) and Bank of England (BoE) to start
cutting by mid-year are still intact.
    ECB policymaker Madis Muller said on Friday the central bank
could cut interest rates "a few more" times by the end of the
year after a first move in June if inflation behaves as
expected, similar to what ECB President Christine Lagarde had
hinted last week, while not pre-committing to any rate path. 
    The ECB's Robert Holzmann, however, said the ECB probably
will not cut rates this year as much as planned if the Fed does
not move.
    BoE Governor Andrew Bailey and Deputy Governor Dave Ramsden
alluded last week to Britain's inflation slowing as expected.
Sterling hit $1.2367, a mid-November low, on Friday. It was last
at $1.2383.
    Analysts do not see too much room for U.S. Treasury yields
to rise further, given the light economic data calendar for the
rest of the month and how far they have already risen as
investors reprice Fed expectations. 
    Two-year notes have seen yields climb 38 basis
points this month to current five-month high levels around
    Bitcoin was last up 1% at $64,832.  The world's
largest cryptocurrency completed its "halving" on the weekend, a
phenomenon that happens roughly every four years and aims to
reduce the rate at which bitcoins are created.
  Currency bid prices at 0030 GMT
 Description         RIC         Last       U.S. Close    Pct
                                             Previous     Change
 Euro/Dollar                     $1.0663    $1.0657       +0.06%
 Dollar/Yen                      154.6550   154.6000      +0.03%
 Dollar/Swiss                    0.9106     0.9103        +0.04%
 Sterling/Dollar                 1.2381     1.2370        +0.12%
 Dollar/Canadian                 1.3728     1.3750        -0.15%
 Aussie/Dollar                   0.6442     0.6419        +0.36%
 NZ Dollar/Dollar                0.5907     0.5889        +0.32%
All spots
Tokyo spots
Europe spots 
Tokyo Forex market info from BOJ 

 (Reporting by Vidya Ranganathan in Singapore; Editing by Jamie