Dollar sinks to ¥110.50 on weak U.S. jobs data

The dollar tumbled to levels around ¥110.50 in Tokyo trading Monday, weighed down by weaker than expected U.S. jobs data for May released late last week.

At 5 p.m., the dollar stood at ¥110.52-53, down from ¥111.56-57 at the same time Friday. The euro was at $1.1264-1265, up from $1.1214-1215, and at ¥124.50-51, down from ¥125.11-13.

The greenback traded around ¥110.40-50 early in the morning after losing ground in New York on Friday following the sluggish U.S. data.

It bounced back to top ¥110.70 briefly in the early afternoon, supported by buying by Japanese importers and purchases reflecting a rise in long-term U.S. Treasury bond yields in off-hours trading, according to market sources.

But the dollar retreated to levels around ¥110.50 later, bowing to renewed selling, the sources said.

According to data released by the Labor Department on Friday, U.S. nonfarm payrolls increased by 138,000 in May from the previous month after seasonal adjustment, falling short of market expectations for an increase of some 185,000. Meanwhile, the jobless rate in May fell to a 16-year low of 4.3 percent.

Despite the currency market’s negative reaction to the employment data, an official at an asset management firm said that the results were “not necessarily a risk-off factor,”

Noting that key U.S. stock indexes finished higher Friday, the official said that the U.S. Federal Reserve is “expected to raise interest rates this month and later, albeit at a moderate pace.”

Currency market participants are keenly awaiting a policy-setting meeting of the European Central Bank, the general election in Britain and a U.S. Senate committee hearing with former FBI Director James Comey, all scheduled for Thursday, traders said.

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