* Soft U.S. non-farm figures weigh on dollar
* Fed's QE will remain in place for some time after jobs
* Dollar still on track to rise towards 100 yen
By Gertrude Chavez-Dreyfuss
NEW YORK, April 5 The U.S. dollar weakened
against most currencies on Friday, hitting nearly two week lows
versus the euro, as weaker-than-expected jobs data raised
concerns that the pace of recovery in the American labor market
has slowed down.
The poor U.S. jobs report along with downbeat economic
indicators in the manufacturing and service sectors earlier this
week should ensure that the Federal Reserve's quantitative
easing policy will be in place for some time, analysts said.
"The market is assured that the Fed will not be taking its
foot off the QE gas pedal anytime soon," said Douglas Borthwick,
managing director at Chapdelaine Foreign Exchange in New York.
"This number is seeing follow-through in dollar weakness and
I expect that to continue against all countries who are not
embarking on QE of their own."
Labor Department data showed that the U.S. economy added
just 88,000 non-farm jobs last month, well below the consensus
forecasts for a gain of 200,000.
The unemployment rate did inch lower to 7.6 percent from 7.7
percent the previous month, while January and February readings
were revised upwards to show that 61,000 more jobs were added.
The euro rose as high as $1.3026, its strongest level
since March 25. It was last at $1.2999, up 0.5 percent.
"The 61,000 additional jobs were not sufficient offsets,"
said Marc Chandler, global head of foreign exchange strategy at
Brown Brothers Harriman in New York.
"Investors have also become more immune to the divergence
with the unemployment rate. The unemployment rate ticked
down...as almost 500,000 people left the labor market."
Against the yen, the dollar last traded up 0.4 percent at
96.70 after earlier hitting session lows at 95.80 yen
following the U.S. jobs report.
Analysts said the main driver for the dollar's moves
against the yen is still the Bank of Japan's mammoth monetary
stimulus announced on Thursday which may further undermine the
"Investors' mindset in trading dollar/yen is to buy it on
dips," said Brian Dangerfield, currency strategist, at RBS
Securities in Stamford, Connecticut. "We know that dollar/yen
will continue to strengthen given what's going on in Japan and
the U.S. payrolls report gave the market the opportunity to buy
it back at a lower level."
The dollar had extended Thursday's gains in Asian trading to
hit a peak of 97.19 yen, a level not seen since August 2009.
Overall, the greenback was still up 11.5 percent against the yen
so far this year, with Thursday's BoJ decision causing the
biggest one-day fall in the Japanese currency since late 2008.