* Aussie & kiwi back at 10-month highs vs USD
* Yen broadly weaker as risk sentiment improves
* Disappointing U.S. data pins dollar down on euro
By Ian Chua
SYDNEY, April 20 (Reuters) - The yen nursed broad losses early on Wednesday as demand for the safe-haven currency waned after U.S. stocks came within reach of a record high, while rising commodity prices sent the Australian and New Zealand currencies to 10-month peaks.
The dollar was back above 109.00 yen JPY= , pulling away from Monday's trough of 107.75. The euro popped above 124.00 yen EURJPY=R for the first time in over a week. It last stood at 124.03.
Against the greenback, the common currency was at $1.1358 EUR= , continuing to recover from a low of $1.1234 set last week. Traders said much now depends on the outcome of the European Central Bank (ECB) policy meeting on Thursday.
In March, ECB chief Mario Draghi unleashed a bold easing package but the euro rallied after he suggested there would be no further cuts.
"The debate over what ECB president Draghi can do to weaken the euro is growing," analysts at ANZ wrote in a note to clients.
"Outside of some verbal discomfort at the euro's strength and reiteration that the ECB stands ready to take further action if necessary, it is difficult to see what he can do."
"The risks of a further squeeze higher in EUR/USD are significant," they added.
Disappointing U.S. housing data on Tuesday was a drag on the greenback against the euro and commodity currencies.
U.S. housing starts fell more than expected in March and permits for future home construction hit a one-year low, fresh evidence pointing to a slowdown in economic growth in the first quarter. Aussie climbed as far as $0.7827 AUD=D4 , reaching a high not seen since June. It's New Zealand peer pushed above 70 U.S. cents for the first time in 10 months. Not to be left out, the Canadian dollar hit a high of C$1.2630 per USD, reaching a high last seen in July.
Keeping kiwi bulls happy, international milk prices rose for a second time this month. Analysts at ASB said the lift in dairy auction prices beat expectations, led by a jump in whole milk.