By Omer Esiner of TravelexThe U.S. dollar turned in a mostly steady performance overnight as investors looked to this morning's U.S. reports on weekly jobless benefits and the trade balance for January. Today's U.S. figures could help to inject a dose of volatility to the currency markets, which has been largely absent this week given the dearth of U.S. data. An above-forecast reading on Chinese consumer prices in February fueled worries of more policy-tightening by the Chinese central bank, which dampened investor risk appetite to the benefit of the dollar and the Japanese yen. However, the yen's safe haven-induced gains were limited after data showed a downward revision to Japanese growth during the fourth quarter of 2009. The lower growth estimate increased expectations the Bank of Japan might soon introduce fresh easing measures in its battle against deflation. The BoJ next meets on March 16-17. Sterling stabilized off recent one-week lows against the dollar and euro, helped by a U.K. central bank survey that showed a modest increase in expectations for British inflation over the coming year. Still, given the economic and political headwinds facing the U.K. economy, the U.K. pound's overall heavier tone is likely to persist over the short term. The Canadian dollar neared a five-month high against the U.S. dollar on Wednesday, largely on the back of higher oil prices above $82 a barrel. However, the loonie parted with some of its gains due to the reduction in risk appetite and ahead of Canadian reports due out this morning on the trade balance and new housing costs. CNY: Consumer prices in China soared to a 16-month high on the year in February, fuelling worries of more policy-tightening by the Chinese central bank to keep a lid on inflation. China's consumer price index rose 2.7% (y/y) in Feburary compared to 1.5% (y/y) the previous month and the 2.3% (y/y) forecast. Investors fret that the People's Bank of China will be more inclined to boost interest rates which would put the economic brakes on the world's third-largest economy. The concern is that a policy tightening by China might also slow the global recovery. Consequently, investors generally headed for safe haven alternatives like the dollar and the yen following China's red-hot consumer inflation figures overnight.