Dollar under pressure, commodity currencies jump

By Anirban Nag

SYDNEY (Reuters) - The U.S. dollar fell on Monday while the New Zealand dollar led other commodity-linked currencies sharply higher after dairy giant Fonterra lifted its forecast payout to farmer shareholders by almost 20 percent.

Also hurting the U.S. dollar was a meeting of the Group of 20 finance officials meeting that failed to take any concrete action to rebalance global flows or talk more specifically about the dollar's recent decline.

The International Monetary Fund in a statement said while the U.S. dollar has depreciated in the recent months, it still remained on the "strong" side, sparking another bout of selling in Asia.

The dollar index was 0.23 percent lower at 75.646 with the euro higher at $1.4870, from $1.4846 late in New York on Friday. The dollar and the yen had gained on Friday after a weaker-than-expected U.S. non-farm payrolls report for October.

On Friday, the U.S. government reported employers cut 190,000 jobs in October, driving the unemployment rate to a 26- year high of 10.2 percent. Both the yen and the U.S. dollar tend to gain when doubts about a global recovery emerge.

"The numbers mean the Fed will keep rates low for sometime to come and U.S. dollar will be the preferred currency for carry trades," said Jonathan Cavanagh, currency strategist at Westpac. "Also, the Fonterra news has lifted the kiwi and other commodity currencies."

The head of the Federal Reserve's St Louis branch, James Bullard, told the Financial Times that he did not favor tightening until the recovery was well established and suggested rates could stay near zero for all of next year.

The New Zealand dollar surged to around $0.7350, its highest since Oct 29, from about $0.7243 in late Friday trade. Dairy is New Zealand's biggest export and the increase in Fonterra's payout mirrored an increase in international dairy prices.

The Australian dollar climbed to above $0.9200, mirroring the sharp gains in the New Zealand dollar.

The yen gained against the U.S. dollar to 89.75 yen, from around 89.92 late on Friday, while it held steady on the euro at 133.50 yen.

Data from the Commodity Futures Trading Commission on Friday showed that speculators had increased their long positions on the yen while trimming those in the euro.

They also decreased bets against the U.S. dollar, with the value of the dollar's net short position falling to $10.95 billion in the week ending November 3, from $15.61 billion net short in the prior week. Still, speculators have been short on the U.S. dollar for 26 weeks and that is unlikely to turn soon.

(Editing by Wayne Cole)