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Asian shares got off to a subdued start on Friday, while the dollar held near two-year highs against the euro on speculation that data later in the day will show the U.S. economy outperforming the rest of the developed world.

The euro was off 1 per cent for the week at $1.1133 as euro zone economic figures continued to disappoint.

Against a basket of currencies, the dollar was 0.8 per cent firmer for the week so far at 98.128 having touched its highest since May 2017.

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The yen proved an outlier by gaining as speculators cut short positions ahead of holidays which will see most Japanese markets shut for six whole trading days.

The exceptionally long break has investors concerned there could be another “flash crash” like the one in early January that drove the yen massively higher in a matter of minutes.

The dollar was down at 111.51 yen, after shedding 0.5 per cent overnight, but was buoyed elsewhere by solid data on U.S. capital goods orders.

The rise in the yen and some mixed Japanese economic data nudged the Nikkei down 0.7 per cent. MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.1 per cent.

The mood might lighten later on Thursday should data on U.S. gross domestic product (GDP) prove as upbeat as some now expect.

A string of solid numbers has led analysts to revise up their forecasts for growth and the latest median polled by Reuters is for an annualized 2.0 per cent.

The closely-watched estimate of GDP from the Atlanta Federal Reserve is projecting an outcome of 2.7 per cent, a huge turnaround from a few weeks ago when it was down at 0.5 per cent.

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Yet the rebound has not been mirrored in inflation which remains subdued across much of the developed world, prompting a host of central banks to turn dovish.

Just this week central banks in Sweden and Canada have backed off plans to tighten, while the Bank of Japan tried to dispel doubts about its accommodative stance by pledging to keep rates at super-low levels for at least one more year.

European Central Bank Vice-President Luis de Guindos on Thursday opened the door to more money-printing if needed to boost inflation in the euro zone.

Rate cuts look much likelier in Australia and New Zealand after recent disappointingly weak inflation reports.

The Federal Reserve holds a policy meeting next week and is expected to reaffirm its patient stance. A Reuters poll of analysts out Thursday found most believed the Fed was done with tightening altogether.

MIXED EARNINGS

Wall Street had ended Thursday mixed after a raft of earnings reports. The Dow fell 0.51 per cent, while the S&P 500 lost 0.04 per cent and the Nasdaq added 0.21 per cent.

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Amazon.com Inc shares firmed after the market closed as the company reported a first-quarter profit that topped estimates.

Shares of Facebook Inc and Microsoft Corp both jumped after they reported better-than-expected results. Intel Corp fell sharply after the chip maker forecast current-quarter revenue below estimates.

In commodity markets, spot gold was idling at $1,278.26 per ounce.

Brent crude ran into profit-taking after hitting $75 per barrel on Thursday for the first time in nearly six months following the suspension of some Russian crude exports to Europe.

Brent crude futures lost 20 cents to $74.15 a barrel, while U.S. crude was last down 24 cents at $64.97 a barrel.

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