The dollar fell to its lowest against the yen in more than two weeks on Thursday, weighed down by uncertainty over whether the U.S. Federal Reserve will raise interest rates this summer and a loss of risk appetite from investors as oil and world stock prices fell.
A weaker-than-expected ADP National Employment Report showed private payrolls increased by 173,000 last month, missing estimates of 175,000 new jobs expected by economists surveyed by Reuters. That helped trim expectations the Fed would raise U.S. overnight interest rates at its upcoming policy meeting, as the ADP report reduced expectations for Friday's U.S. non-farm payrolls report, analysts said.
Fed funds futures show traders now see only a 17 percent chance the U.S. central bank will raise rates when it next meets on June 14-15, according to CME Group's FedWatch tool.
"I just don't think that we have the strength in the economy to support a rate hike at this point," said Fabian Eliasson, vice president for currency sales at Mizuho Corporate Bank in New York. "If you look into the futures (rates) that's what they're telling us."