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The euro remained lower against the yen after a four-day decline before a report forecast to show the region’s economy shrank in fourth quarter, adding to signs the currency bloc’s debt crisis is hampering growth.

Demand for the dollar was supported after Federal Reserve Bank of Dallas President Richard Fisher said yesterday he opposes additional bond purchases, which may debase the world’s reserve currency. The Australian dollar fell to a one-week low before a central bank meeting today at which policy makers will decide on interest rates.

“Buying the euro makes no sense,” said Marito Ueda, senior managing director in Tokyo at FX Prime Corp. (8711), a currency margin company. “The European Central Bank is tied up with tackling the region’s sovereign-debt problem and has no room left to bolster the economy through monetary policy.”

The euro bought 107.65 yen as of 10:31 a.m. in Tokyo from 107.79 at the close in New York yesterday, when it dropped 0.2 percent. The common currency was little changed at $1.3222. The dollar fetched 81.42 yen from 81.56 yen.

The Dollar Index (DXY), which Intercontinental Exchange Inc. uses to track the U.S. currency against six major counterparts, reached 79.575 yesterday, the highest since Feb. 16, before trading at 79.310 today.

Gross domestic product in the 17-nation euro area probably fell 0.3 percent in the last quarter of 2011 from the previous three month period, according to the median estimate of economists in a Bloomberg News survey before the European Union’s statistics office releases the data today. That would be the first drop since the second quarter of 2009 and would be in line with a Feb. 15 estimate. The ECB will keep its benchmark interest rate at a record low 1 percent on March 8, according to a separate survey.

Greek Debt Swap
Greece is aiming to complete a bond exchange with private investors by March 8 in order to receive a 130 billion-euro ($172 billion) bailout. Greece expects bondholders to accept the offer and is ready to force them to participate if necessary, Finance Minister Evangelos Venizelos said in a Bloomberg Television interview in Athens yesterday.

“If Greece’s creditors agree on a debt swap, the biggest cause for concern will recede and there is likely to be an unwinding of short positions on the euro,” said Noriaki Murao, managing director in New York at the Bank of Tokyo-Mitsubishi UFJ Ltd., a unit of Japan’s biggest financial group by market value. “There’s a good chance that Greece’s debt-swap negotiation will go well.”

U.S. Growth
The euro has weakened 3.1 percent in the past six months, while the dollar has strengthened 2.8 percent, according to Bloomberg Correlation-Weighted Indexes that track 10 developed- market currencies. The yen dropped 4 percent.

Recent reports have highlighted that U.S. growth is broadening, with data yesterday showing service industries unexpectedly expanded last month at the fastest pace in a year. ADP Employer Services may say companies in the U.S. added 213,000 workers in February from 170,000 in the prior month, a survey of economists showed before tomorrow’s figures.

“If the data continue to improve, however gradually, the markets should begin preparing themselves for the good Dr. Fed to wean them from their dependency rather than administer further dosage,” Fisher said yesterday in Dallas. He is scheduled to speak on the economy in Houston.

Fed Policy
Fed Chairman Ben S. Bernanke gave no indication in congressional testimony last week that the U.S. central bank was considering altering record stimulus. The Fed, which will meet March 13, bought $2.3 trillion of bonds in two rounds of so- called quantitative easing from December 2008 to June 2011, and has pledged to keep interest rates low at least through late 2014.

“The U.S. economic recovery isn’t temporary, but becoming a sustainable trend,” said FX Prime’s Ueda. “From the perspective of fundamentals, the dollar will be bought.”

Reserve Bank of Australia policy makers will keep the overnight cash rate target at 4.25 percent at today’s meeting, according to all 24 economists surveyed by Bloomberg.

Australia’s dollar touched $1.0652, the lowest since Feb. 27, before trading at $1.0658, 0.1 percent below yesterday’s close.