By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) - The dollar slid against the yen on Tuesday, as investors shifted their focus away from hawkish remarks on U.S. interest rates by Federal Reserve officials and towards a speech on Friday by Fed Chair Janet Yellen.
Yellen will speak at the annual meeting of world central bankers in Jackson Hole, Wyoming, at the end of the week.
Investors are anxious to see whether Yellen will echo the hawkish views expressed by Fischer and New York Fed President William Dudley, or take a more subdued stance in line with the minutes from the Fed's July policy meeting. Those minutes suggested the central bank was not in a hurry to raise rates.
The greenback was given a boost over the weekend when Fed Vice Chairman Stanley Fischer said the U.S. central bank was getting close to its employment and inflation targets, prompting speculation a rate hike could come next month.
"The big surprise (at Jackson Hole) would be a hawkish shift from Yellen which would be enough to rock the boat on risk and send U.S. rates and the dollar sharply higher," said Brad Bechtel, managing director at Jefferies in New York.
"But I doubt she wants to do this and would prefer a relatively mixed view that has elements of hawkishness and dovishness and ultimately results in a December tightening, but a dovish December tightening."
The dollar briefly slipped below 100 yen > earlier before recovering to 100.21 yen late Tuesday, down 0.1 percent.
The dollar, having hit a five-day high of 94.958 <.DXY> against a currency basket on Monday, was flat at 94.533 late in the day.
TD Securities echoed Bechtel's assessment, saying Yellen would continue to reiterate the Fed's tightening bias, but her message would be "sufficiently nuanced" to reflect the Fed's lack of urgency to raise rates.
"We think the dollar is already trading under the impression of a dovish Fed," said TD Securities in Tuesday's research note. "Dollar/yen is most prone to squeeze higher given positioning risks and cross-market divergences."
The greenback was briefly helped earlier by data showing U.S. new home sales surged 12.4 percent to a seasonally-adjusted annual rate of 654,000 units last month, the highest since October 2007.
The euro edged up 0.1 percent to $1.1329 >, close to last week's two-month high of $1.1366. Data showed euro zone private business activity was stable in August. The data eased concerns Britain's vote to leave the European Union would spill over negatively into the euro zone.
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Chizu Nomiyama and Alan Crosby)
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