By Chibuike Oguh and Alun John
NEW YORK/LONDON, Oct 27 (Reuters) - The dollar edged higher against major currencies including the euro, yen and sterling on Tuesday amid market positioning ahead of a series of central bank meetings for fresh clues on the economic outlook and the path of interest rates.
The dollar has also stabilized after it came under pressure following a selloff in high-flying AI stocks last week.
The euro was down 0.33% against the dollar at $1.1136.
"The dollar has rebounded ahead of the Fed meeting and AI sentiment has stabilized a little bit after last week," said Kevin Ford, FX and macro strategist at Convera.
"The dollar was caught in the crossfire last week as an extension of the equity distress, high oil prices and what's happening with European fiscal stress coming from France. So I think what markets have done is to take a little bit of the pressure off the Fed to hike rates."
The Federal Reserve is set to announce its latest policy decision on Wednesday, the European Central Bank is up on Thursday, and the Bank of Japan rounds out the week on Friday. All three are expected to keep rates on hold, so the focus will be on any hints that policymakers give on their outlooks.
"USD risks skew lower on a hold: hawkish messaging is broadly neutral, while a dovish hold risks outsized USD weakness," said Bank of America analysts led by Mark Cabana in an investor note.
The euro was on track to be the worst-performing developed-market currency in October, down 1.70% on the dollar, bruised by high energy costs, the volatility in French government bonds and worries about France's fiscal position.
The single currency extended its fall slightly after the release of the ECB's quarterly Bank Lending Survey, which showed the impact of its rate hikes becoming visible. If that trend continues, it could, at the margin, reduce pressure on the ECB to continue with rate hikes deep into next year.
Meanwhile, Japanese Finance Minister Satsuki Katayama said the government stood ready to take decisive action in the currency market, reminding markets of its willingness to prop up its currency.
The yen was among the best-performing major currencies last week, strengthening around 0.75% on the dollar, its biggest weekly gain since early September, as AI jitters in the equity market spurred a rush into the currency.
The dollar was up 0.24% to 157.90 against the Japanese yen. Sterling weakened 0.19% against the dollar to $1.3317.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.27% to 102.29.
The Reserve Bank of New Zealand and the Bank of Canada also announce their policy decisions on Wednesday, with both expected to raise interest rates.
The New Zealand dollar strengthened 0.08% versus the greenback to $0.569.
The Canadian dollar weakened 0.27% versus the greenback to C$1.405 per dollar.
(Reporting by Chibuike Oguh in New York and Alun John in London; Editing by Andrea Ricci and Chizu Nomiyama )