The euro was slightly higher against the dollar in Asian trade Thursday, with many investors sitting on the sidelines ahead of a key European Central Bank policy meeting later the day.

The euro EURUSD, +0.14%  last changed hands at $ 1.1592, compared with $ 1.1588 late Wednesday in New York ahead of the ECB meeting, where the central bank is widely expected to launch a sovereign bond-purchasing program to shore up the eurozone’s fragile economy and boost inflation.

A Wall Street Journal report said Wednesday that the ECB’s Frankfurt-based executive board proposed purchasing roughly EUR50 billion ($ 58 billion) a month in bonds for at least a year in the move to adopt quantitative easing. The common currency fluctuated sharply following the report, briefly hitting $ 1.1668 overnight after initially diving in reaction to the report.

“The market lacks energy to sell the euro further,” said Yuzo Sakai, manager of FX business promotion at Tokyo Forex & Ueda Harlow.

Jon Hilsenrath analysis: ECB stimulus and the Fed

A proposal from the ECB’s executive board calls for bond purchases of roughly €50 billion ($ 58 billion) a month that would last for a minimum of one year. Jon Hilsenrath joins MoneyBeat.

“There is absolutely no need to make a move” ahead of the ECB outcome, says Sakai, adding that the prevailing mood in the market was to take a wait-and-see stance.

The currency market seems to have largely factored in the ECB’s likely monetary easing steps, meaning that covering of investors’ euro short positions especially against the dollar will likely kick in after the news, if the outcome is largely in line with the media reports, said IG Securities market analyst Junichi Ishikawa.

Parity on the horizon? With the Greek election coming up on Jan. 25, however, such short-covering may be short-lived, Ishikawa said.

“Much greater bolstering of monetary easing than expected by ECB President Mario Draghi will give a surprise” that likely sends the euro below $ 1.1460, its low set on Jan. 16, he said.

Among other currency trading pairs, the dollar USDJPY, -0.25%  was at ¥118.05, compared with ¥117.81 late Wednesday in New York.

Earlier in the session, the greenback gained from flows related to buying by Japanese importers and long-term funds, and the yen’s weakness against currencies other than the dollar. The greenback briefly hit ¥118.34 after the gains appeared to trigger stop-loss buying orders. But stock market weakness also weighed on the U.S. unit.

The yen was weaker against its major rivals. The euro EURJPY, -0.09%  was at ¥136.88 from ¥136.50, and the British pound GBPJPY, +0.06%  was at ¥178.77 against ¥178.29.

The WSJ Dollar Index BUXX, -0.19%  , a measure of the dollar against a basket of major currencies, was up 0.09% at 84.25.

Interbank Foreign Exchange Rates At 23:50 EST / 0450 GMT Latest Previous %Chg Daily Daily %Chg Dollar Rates Close High Low 12/31 USD/JPY Japan 118.05-06 117.95-96 +0.08 118.34 117.81 -1.39 EUR/USD Euro 1.1603-06 1.1609-12 -0.05 1.1630 1.1594 -4.08 GBP/USD U.K. 1.5133-38 1.5140-45 -0.05 1.5162 1.5132 -2.84 USD/CHF Switzerland 0.8621-25 0.8597-601 +0.28 0.8653 0.8587 -13.28 USD/CAD Canada 1.2359-64 1.2337-42 +0.18 1.2364 1.2325 +6.37 AUD/USD Australia 0.8061-65 0.8083-87 -0.27 0.8110 0.8056 -1.32 NZD/USD New Zealand 0.7530-36 0.7549-55 -0.25 0.7578 0.7516 -3.36 Euro Rate EUR/JPY Japan 136.96-7.00 136.89-93 +0.05 137.32 136.78 -5.49 Source: ICAP PLC

Write to Hiroyuki Kachi at

(END) Dow Jones Newswires

January 22, 2015 00:31 ET (05:31 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.