The greenback edged lower against the yen on Wednesday as better-than-expected U.S. economic report which suggested the worst of the recession’s job losses may had passed and rising global equity markets reduced the U.S. dollar's safe-haven appeal. Investors bought Japanese yen against the dollar and usd/jpy fell to as low as 97.94 in yesterday’s Asia morning before rebounding, traded at around 98.35 in late New York session.

The single currency rebounded strongly from 1.3245 to 1.3375 against the dollar after release of better-than-expected PMI service index in eurozone (43.8 in April compared to 40.9 in previous month) but it traded at around 1.3330 in late New York session as gains were capped ahead of ECB’s policy meeting on Thursday (the central bank is expected to cut interest rates to a record low of 1 percent and may announce measures to stimulate lending and growth).

Meanwhile, sterling rose against the dollar and euro as better-than-expected economic data added signs that recession in U.K. had started to ease. The PMI service index, a U.K. gauge of services industries from banks to computing, rose the most since 1999 in April to 48.7 from 45.5 in March, while Nationwide Building Society’s consumer confidence gauge increased by 8 points to 50 in last month. The British pound strengthened versus the dollar, euro and yen, climbed to session highs of 1.5150, 0.8804 and 149.33 respectively before stabilising. The bank of England also meets on Thursday and is seen holding its benchmark interest rate at record low of 0.5 percent.

On the data front, Australian retail sales rose 2.2 percent in March, much better than the economists’ median forecast of 0.5 percent gain and compared to a 2 percent drop in February. A separate report later in the day from U.S. showed the worst of the recession’s job losses may had passed as a private report stated that companies in the U.S. cut an estimated 491,000 workers from payrolls in April, smaller than consensus forecast of 650,000 workers and was revised to show a reduction of 708,000 workers, down from a previous estimate of 742,000.

Economic data releases on Thursday include Australia employment change and unemployment rate, Switzerland’s CPI, German factory orders, U.K. BOE rate decision, eurozone ECB rate decision, and U.S. weekly jobless claims, labour cost and productivity. At 13:30GMT, Federal Reserve Chairman Ben S. Bernanke will speak via satellite to the Chicago Fed’s annual conference on Bank Structure and Competition with the topic ‘Banking Supervision’