News Column

Dollar firm at upper 102 yen on U.S. jobs data optimism

July 31, 2014

The U.S. dollar stayed firm in the upper 102 yen range Friday morning in Tokyo on expectations a U.S. jobs report due later in the day will show continued improvement in the U.S. economy.

At noon, the dollar fetched 102.90-91 yen compared with 102.75-85 yen in New York and 102.86-87 yen in Tokyo at 5 p.m. Thursday.

The euro was quoted at $1.3387-3388 and 137.76-77 yen against $1.3385-3395 and 137.60-70 yen in New York and $1.3395-3397 and 137.78-82 yen in Tokyo late Thursday afternoon.

The dollar traded below a four-month high of 103.15 yen marked Wednesday ahead of the release of a July U.S. jobs report on Friday.

The report is expected to show employers expanded nonfarm payrolls by more than 200,000 for the sixth straight month.

With the national unemployment rate likely to stay near last month's 6.1 percent, the lowest since 2008, the focus will be on whether wages have picked up, said Kengo Suzuki, chief foreign exchange strategist at Mizuho Securities Co.

Compensation costs for U.S. workers increased 0.7 percent in the April-June period, marking the highest growth in about five and a half years, a Labor Department report showed Thursday.

"The rise in labor costs is fanning expectations that wages will have improved," Suzuki said.

The euro was a touch weaker against the dollar after a preliminary estimate showed inflation in the eurozone lagged at an annualized 0.4 percent in July, far below the European Central Bank's target of just below 2 percent.

"The euro remains on a downtrend," Suzuki said. "The weak reading adds to the view the ECB will act with further easing in the future."

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Source: Japan Economic Newswire

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