* Expectations of measured ECB message underpin euro
* Dollar/yen back above 117 after sliding to 115.97 overnight
* Rebound in crude oil and equities help dollar recover
* Market tone still shaky after stocks sell-off (Updates after start of European trading)
By Patrick Graham
LONDON, Jan 21 (Reuters) - Expectations of a steady-as-she-goes message from the European Central Bank in the face of renewed financial market turbulence kept the euro strong against the dollar ahead of the bank's January decision and statement on Thursday.
With European stock markets recovering and oil prices stabilising after another dizzying sell-off on Wednesday, global investors' other currency safe haven of choice - the yen - retreated marginally against the dollar. JPY=EBS
The major currencies most tied to China, oil and the level of overall global risk-taking all still looked shaky. Sterling - down 10 percent since early December - fell another 0.2 percent to $1.4163. GBP=D4
But all were off lows hit on Wednesday and traders said the lack of action from central banks in Brazil and Canada - both had been expected by many to move on policy - had calmed currency markets somewhat into the ECB meeting.
"Clearly, the grownups all wanted to say 'let's calm down' and moves on currencies have been relatively muted," said Richard Benson, co-head of portfolio management with currency fund Millennium in London.
"These central banks are well aware that they can't be too downbeat when talking about growth and inflation expectations. The ECB is not going to ease. I suspect it will remind the market of the moves it made in December and leave it at that."
The euro was up 0.1 percent at $1.0905 EUR= in early European trade, down from an overnight high of $1.0976 and virtually unchanged from levels seen immediately after the ECB's last meeting in December.
Analysts assume that keeping the euro weak is a central plank of ECB chief Mario Draghi's efforts to refloat the euro zone economy and get inflation moving back towards its target of below or close to 2 percent.
But they are far less sure of how much more currency weakness Draghi and colleagues would like from here: market forecasts on euro-dollar rates are now widely split after a year when most only pointed down. FXPOLLS
The dollar had recovered to 116.88 yen JPY= , having descended to 115.97 yen overnight, its lowest since January 2015. A report by Bloomberg quoting an unidentified Tokyo official that authorities were "closely watching the currency markets" lifted the greenback, traders in Asia said.
Reflationary stimulus policies under Japanese Prime Minister Shinzo Abe have helped to weaken the yen, and authorities are generally seen to be wary towards the currency appreciating excessively.
"That a Japanese official was reportedly prompted to speak on the yen was likely due to the excessive move seen on Wednesday, rather than the fact that dollar/yen fell into the 115 threshold," said Masafumi Yamamoto, chief FX strategist at Mizuho Securities in Tokyo.
The Australian dollar, battered earlier in the week amid the tumult in global risk assets and commodities, was down 0.2 percent at $0.6894 AUD=D4 having traded almost flat following the mild rebound in crude oil prices.