By - Sophie Knight and Ian Chua
Category - Hampton Hotels Santa Clarita
Posted By - Hampton Inn Santa Clarita
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After falling as much as 3 percent to a seven-week trough of 95.90 yen on Thursday, the greenback was trading at 96.65. That was 0.4 percent lower than late U.S. levels, with dealers citing selling from Japanese exporters on concerns that it could take time for the dollar to recoup its losses.
Traders said while there was no concrete trigger for the vicious selloff in the greenback overnight, the move has helped flush out some long USD positions ahead of the non-farm payrolls report due at 1230 GMT (8.30 a.m. EDT).
Just last month, investors had turned bullish on the dollar on the belief that upbeat data would prompt the U.S. Federal Reserve to roll back its $85 billion per month bond-buying program.
However, some traders have cut their dollar-longs after recent data raised concerns that Friday's jobs data will disappoint.
"It appears that markets are positioning for a weaker number," said Barclays Capital analysts.
Barclays Capital is, however, forecasting a 175,000 rise in employment, above the 170,000 expected by economists polled by Reuters.
"We think that an outturn close to our forecast could lead to broad USD strength, especially versus low-carry currencies."
The dollar index .DXY remained sluggish on Thursday, dropping 0.1 percent to 81.637 after slumping 1.3 percent to three-month lows on Thursday.
Against the euro, the greenback steadied after losing 1.2 percent on Thursday to a three-month low of $1.3306. It was last at $1.3251, little changed from late New York levels.
Market participants said the euro's move was more driven by the dollar's weakness against the yen than the European Central Bank (ECB)'s widely expected decision to leave its benchmark rate at a record low 0.5 percent.
Indeed, the resurgence of the yen left the euro down 0.5 percent at 127.76 yen, close to the five-week low of 127.53 it plumbed on Thursday.
The recent rise in the yen threatens to undermine the Bank of Japan's stimulus efforts, which have weakened the Japanese currency, helping exporters' overseas revenues up.
"Japanese exporters weren't selling forwards outright before because they expected too much; they wanted to see a higher (dollar) level above 100, like 105," said the director of a research firm who asked not to be identified.
"But the Ministry of Finance don't care about the level so much. They talked it up to 95 and then it got to 100, he said, adding the ministry would happy enough if the dollar remained above 90.
Japanese government officials said they were concerned about the sharpness of the yen's move but did not express any overt worries about the level of the currency.
"We are watching these moves, but this is not about intervention and I don't think we have to respond immediately," Finance Minister Taro Aso told a news conference.
The yen gained 1.7 percent against the Australian dollar to 91.40, after rising as high as 91.20, a level not seen since January 9.
The Aussie also resumed its recent slide after the U.S. dollar's broad weakness plucked it off a 20-month low of $0.9435 on Thursday. It lost 0.7 percent compared to late U.S. levels to $0.9500, within reach of its 2011 trough of $0.9388.
Traders said while there was no concrete trigger for the vicious selloff in the greenback overnight, the move has helped flush out some long USD positions ahead of the non-farm payrolls report due at 1230 GMT (8.30 a.m. EDT).
Just last month, investors had turned bullish on the dollar on the belief that upbeat data would prompt the U.S. Federal Reserve to roll back its $85 billion per month bond-buying program.
However, some traders have cut their dollar-longs after recent data raised concerns that Friday's jobs data will disappoint.
"It appears that markets are positioning for a weaker number," said Barclays Capital analysts.
Barclays Capital is, however, forecasting a 175,000 rise in employment, above the 170,000 expected by economists polled by Reuters.
"We think that an outturn close to our forecast could lead to broad USD strength, especially versus low-carry currencies."
The dollar index .DXY remained sluggish on Thursday, dropping 0.1 percent to 81.637 after slumping 1.3 percent to three-month lows on Thursday.
Against the euro, the greenback steadied after losing 1.2 percent on Thursday to a three-month low of $1.3306. It was last at $1.3251, little changed from late New York levels.
Market participants said the euro's move was more driven by the dollar's weakness against the yen than the European Central Bank (ECB)'s widely expected decision to leave its benchmark rate at a record low 0.5 percent.
Indeed, the resurgence of the yen left the euro down 0.5 percent at 127.76 yen, close to the five-week low of 127.53 it plumbed on Thursday.
The recent rise in the yen threatens to undermine the Bank of Japan's stimulus efforts, which have weakened the Japanese currency, helping exporters' overseas revenues up.
"Japanese exporters weren't selling forwards outright before because they expected too much; they wanted to see a higher (dollar) level above 100, like 105," said the director of a research firm who asked not to be identified.
"But the Ministry of Finance don't care about the level so much. They talked it up to 95 and then it got to 100, he said, adding the ministry would happy enough if the dollar remained above 90.
Japanese government officials said they were concerned about the sharpness of the yen's move but did not express any overt worries about the level of the currency.
"We are watching these moves, but this is not about intervention and I don't think we have to respond immediately," Finance Minister Taro Aso told a news conference.
The yen gained 1.7 percent against the Australian dollar to 91.40, after rising as high as 91.20, a level not seen since January 9.
The Aussie also resumed its recent slide after the U.S. dollar's broad weakness plucked it off a 20-month low of $0.9435 on Thursday. It lost 0.7 percent compared to late U.S. levels to $0.9500, within reach of its 2011 trough of $0.9388.
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