Dollar Rises vs. Yen After Nonfarm Jobs Report
The U.S. dollar rose against the yenFriday after the key U.S. nonfarm payrolls report came in not as bad as many had feared, bolstering investors' appetite for riskier assets.
The dollar was little changed against the euro, stabilizing after falling sharply in the previous session sparked by a smaller-than-expected interest-rate cut by the European Central Bank.
The dollar rose above 100 yen after data showed U.S. employers cut 663,000 jobs in March and drove the unemployment rate to 8.5 percent, a 25-year high.
"It's a pretty awful number but it was almost to be expected,'' said Matt Esteve, a foreign exchange trader at Tempus Consulting in Washington. "There seems to be no bottom in the U.S. job markets yet, but other recent economic indicators have been better than expected.''
"The dollar trading above 100 versus the yen, it's really where it should be,'' he added. "The Japanese economy is in dire straits.''
The dollar was last up at over 100 yen after rising as high as 100.37 yen, a five-month peak, according to Reuters data.
The euro was up over $1.34 after dipping to $1.3366 after the jobs data. A slowing rate of contraction in Britain's services sector lifted sterling to above $1.48.
The dollar and yen have come under pressure in recent sessions, while higher-yielding, commodity currencies rose as gains in stock markets worldwide eroded safe-haven flows into the two currencies.
Investor appetite for risk improved on Thursday after fresh efforts by world leaders at the G20 summit in London to fight the global economic crisis spurred optimism and on a change in U.S. accounting rules that should help troubled banks.
The dollar and yen tend to rise in times of trouble as investors repatriate funds from higher-yielding currencies and riskier assets.
"There had been a degree of enthusiasm that perhaps the world economy has seen the worst, and the jobs data tempered that enthusiasm a bit,'' said Vassili Serebriakov, currency strategist at Wells Fargo in New York.
But while he said the data points to a sharp economic contraction in the first three months of the year, "the actual report was close to expectations'' and thus failed to erase what he called the "feel-good factor in markets in recent days.''