Dollar Drops Past 93 Yen Before U.S. Jobs Data

The dollar fell past 93 yen for the first time in a month before data this week forecast to show the recovery in the U.S. job market isn’t fast enough to prompt the Federal Reserve to reduce monetary stimulus.

The yield premium on 10-year Treasuries over similar- maturity Japanese government bonds slid to the least in a month, sapping the allure of the greenback. The yen rose against its major peers as investors weighed what the Bank of Japan (8301) will decide to do during a two-day meeting starting tomorrow. Demand for the euro was limited before Italian President Giorgio Napolitano meets advisers today for talks on forming a new government.

“The U.S. economy isn’t strong enough to make a significant dent in the unemployment rate,” said Peter Dragicevich, a Sydney-based currency economist at Commonwealth Bank of Australia (CBA), the nation’s largest lender. “Given that’s one of the key thresholds the Fed is looking for, we can’t see it pulling back from its stimulus.”

The dollar fell 0.2 percent to 93.09 yen as of 9:57 a.m. in Tokyo after touching 92.96, the weakest since March 5. It lost 0.1 percent to $1.2867 per euro. Europe’s 17-nation currency touched 119.49 yen, the lowest since Feb. 27, before trading little changed at 119.77.

Companies in the U.S. probably added 200,000 jobs last month after an increase of 198,000 in February, economists forecast in a Bloomberg News survey before ADP Research Institute releases the data tomorrow. Government figures on April 5 are likely to show that the jobless rate was 7.7 percent in March, unchanged from the prior month, according to another poll.

(Source: Bloomberg)