FOREX-Yen sees little reprieve after tough month, Japan data eyed
* Yen down 4 pct versus euro and dollar this month
* EUR/USD lifted by higher-than-expected German inflation data
* AUD selloff pauses after strong corporate spending figures
SYDNEY, Nov 29 (Reuters) - The yen was pinned at a four-year trough against the euro and a six-month low on the dollar early in Asia on Friday, having suffered a bruising week as investors used the low-yielding currency to buy riskier assets.
The Japanese currency has taken on the status as the funding currency of choice as the Bank of Japan is committed to maintaining an ultra-loose monetary policy, part of Prime Minister Shinzo Abe's goal of sustaining growth and conquering 15 years of deflation.
A rush of Japanese data due this morning including inflation and industrial output are expected to highlight a steady recovery in the world's third-biggest economy.
The euro last traded at 139.10 yen, having risen as far as 139.25 as the market attempted to test the June 2009 peak of 139.26. A break there will take it to highs not seen since October 2008.
The dollar bought 102.28 yen, not far from a six-month high of 102.375 set overnight. It is moving ever closer to its 2013 peak of 103.74 reached back in May.
Over the month, both the euro and dollar are up around 4 percent on the yen, posting one of their biggest monthly gains this year.
"The yen crosses are up across the board for the month due in large part to expectations that the Bank of Japan will offer a follow-up stimulus program to April's unprecedented injection," John Kicklighter, chief strategist at DailyFX in New York, said in a note.
This means that this morning's data will be closely watched, he added.
"If the National CPI figure picks up materially above the 1.1 percent pace, it could feed fear that the second round of stimulus may not be needed. Alternatively, a miss only solidifies the need and pushes for a nearer time frame."
EURO ZONE INFLATION
Investors also bought the euro against the dollar after German data on Thursday suggested euro zone inflation could come in higher than expected, reducing the chances of the European Central Bank having to ease anytime soon.
Preliminary German consumer prices harmonised with other EU countries rose 1.6 percent this month, overshooting even the highest forecast of 1.5 percent in a Reuters poll.
The euro scaled a one-month peak of $1.3619 and last stood at $1.3602. It was on track to post a third straight week of gains. That left the dollar index dangling near a three-week trough set earlier in the week.
Sterling was again a notable outperformer, hitting a fresh 11-month high on the dollar after the Bank of England surprised by scaling back stimulus for the housing sector.
The pound last traded at $1.6334, having risen as high as $1.6358.
Meanwhile, the selloff in the Australian dollar took a breather after surprisingly strong company spending data and investment plans on Thursday prompted markets to rethink the risk of another interest rate cut by the central bank.
The Aussie bounced above 91 U.S. cents, pulling away from a three-month low of $0.9065 plumbed earlier in the week.
Australia's central bank holds its final policy meeting for 2013 next Tuesday and is considered almost certain to leave its cash rate unchanged at a record low 2.5 percent.