Dollar range-bound ahead of key jobs data


07/02/2014 10:24 AST

The dollar moved narrowly in cautious trade in Asia on Friday, ahead of US jobs data that dealers hope will shed light on the health of the world's biggest economy.

In early exchanges the greenback bought 102.08 yen, hardly changed from 102.10 yen in New York Thursday afternoon.

The euro bought $1.3588 against $1.3591 while slipping to 138.70 yen from 138.79 yen.

The common European currency scored broad gains Thursday after the European Central Bank held its key interest rates steady and downplayed risks of damaging deflation in the eurozone.

The US Labor Department is to release January payrolls data later Friday. Robust figures could staunch fears of an economic slowdown as the Federal Reserve reduces its stimulus programme.

Praevidentia Strategy market strategist Masafumi Yamamoto said the dollar should rise towards 103.00 yen if the data meet or beat market expectations.

"If the reading is strong, investors will be confident that the Fed will keep tapering its bond-buying programme leading to gains in the US Treasury yields," he told Dow Jones Newswires.

At a policy meeting in late January, the Bank of Japan decided to stand pat on its own bond-buying scheme, saying its monetary-easing blitz was winning the war on deflation.

Hiromichi Shirakawa, research analyst at Credit Suisse, warned that the stances of developed countries' central banks -- either withholding new easing measures or scaling stimulus back -- could negatively affect the global economy.

"If central banks of developed countries want to correct their emergency monetary easing programmes early, it would put downward pressure on global growth in 2014," he said in a note.

The dollar was mixed against other Asia-Pacific currencies.

The greenback sank to 12,173 Indonesian rupiah from 12,185 rupiah on Thursday, to Sg$1.2684 from Sg$1.2692, and to 62.35 Indian rupees from 62.45 rupees.

It also fell to 1,075.55 South Korean won from 1,076.60 won and to 45.09 Philippine pesos from 45.25 pesos.

It inched up to Tw$30.29 from Tw$30.27, while staying flat at 32.81 Thai baht.

The Australian dollar rose to 91.20 US cents from 89.61 cents, while the Chinese yuan edged up to 16.81 yen from 16.73 yen.

AFP
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