Dollar nurses losses after another set of soft jobs data
dollar had a soft tone in early Asian trading on Friday after losing ground overnight to the euro and sterling on the back of U.S. data showing further signs of a cooling labour market and hence higher odds of Fed rate cuts this year.
Against the Japanese yen, the dollar was trading at 155.39 yen, down from highs of 155.95 hit in the previous session. The euro stood at $1.0782, after a 0.3% gain overnight.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, was flat at 105.25.
The dollar's retreat followed data showing a jump in initial claims for U.S. state unemployment benefits which, coming on top of last week's weak payrolls report, furthered risk-taking in a market that has been vacillating for weeks on when and how much the Federal Reserve will cut rates this year.
Alongside a light rally in U.S. Treasuries and commodities, most major currencies rose, including a yen that has been hobbled by its low yields and sterling which had appeared vulnerable after a dovish Bank of England policy review.
Still, analysts cautioned against dragging out the rally.
«We note jobless claims are weekly data that can be very volatile from week to week,» Commonwealth Bank of Australia's Joseph Capurso, said in a note. «It is far too early to conclude the labour market is weakening significantly.»
For one, they said, the yen's low yields and still-yawning chasm between those and U.S. interest rates could tempt speculators to re-test 34-year lows the currency hit last
