* Graphic: World FX rates tmsnrt.rs/2RBWI5E
* Dollar pinned lower before Fed meets next week
* Euro down after Lagarde curbs tapering speculation
* Ether, bitcoin skid on Biden tax reform worries
By Stanley White and Kevin Buckland
TOKYO, April 23 (Reuters) - The dollar was hemmed into a
narrow trading range near multi-week lows against its major
peers on Friday, as traders contemplate the next moves by major
central banks ahead of a U.S. Federal Reserve meeting next week.
Cryptocurrency ether tumbled more than 10% and
bigger rival bitcoin slid 5% amid speculation that
U.S. President Joe Biden"s plan to raise capital gains taxes
will curb investment in digital assets.
The euro nursed losses after European Central Bank President
Christine Lagarde squashed expectations that policymakers will
start to consider a tapering of bond purchases due to an
improving economic outlook.
Fed Chairman Jerome Powell is likely to repeat Lagarde"s
message that talk of tapering is premature, which would put
downward pressure on Treasury yields and cap the dollar"s gains
against most currencies.
"Powell has to reiterate the continuation of easy monetary
policy just like Lagarde," said Masafumi Yamamoto, chief
currency strategist at Mizuho Securities.
"As a result, the dollar is likely to fall against the yen,
but the larger trend for the dollar is still mixed. The dollar
can still rise against commodity currencies if commodity prices
start falling again."
The dollar slid as low as 107.80 yen on Friday, the
lowest since March 4.
The euro stood at $1.2027 after dropping 0.2% on
Thursday. It was still not far from the seven-week high of
$1.2080 set earlier this week.
The Australian and New Zealand dollars
firmed on Friday, but traders said risks are pointed to the
downside due to a recent weakening in commodity prices.
The British pound was quoted at $1.38535 following
a 0.6% loss the previous session.
The Fed"s next meeting ends on April 28, and while no major
policy changes are expected, investors are paying close
attention to any comments about the chance of scaling back
monetary easing in the future.
Rising coronavirus vaccination rates and an improving
economic outlook are reasons to be optimistic, but investors are
scaling back expectations for a withdrawal of monetary easing
after Lagarde said talk of phasing out emergency bond purchases
is premature, analysts said.
Data on manufacturing and services activity in both the
United States and Germany are due later on Friday, which could
support positive economic sentiment, but the dollar and the euro
are unlikely to move much as investors stick to the sidelines
before the Fed"s meeting, analysts said.
In cryptocurrencies, ether was some 7% lower at about $2,234
and earlier dipped as low as $2,116, retreating from the record
high of $2,645.97 set on Thursday after President Biden unveiled
a plan to nearly double taxes on capital gains for people
earning more than $1 million.
Bitcoin slumped 4.2% to below $50,000, and briefly touched
$48,338. It has fallen every day but two since reaching a record
high of $64,895.22 on April 14.
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Currency bid prices at 548 GMT
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar $1.2028 $1.2016 +0.10% -1.56% +1.2030 +1.2013
Dollar/Yen 107.8670 108.0400 -0.14% +4.45% +107.9870 +107.8000
Euro/Yen
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