* Dollar index hits one-week highs on solid jobs data
* ECB leaves rates at record low, keeps QE door open
* Swedish crown swoons after big rate cut, central bank
* U.S. markets closed on Friday for Independence Day
By Ian Chua
SYDNEY, July 4 The dollar started trade in Asia
at one-week highs on Friday, having shown competitors a clean
pair of heels after surprisingly strong U.S. jobs growth added
to hopes the economy is pulling out of a first quarter slump.
The dollar index climbed as far as 80.315 after U.S.
employers blew away most forecasts by adding 288,000 jobs last
month. It was last at 80.218, well off an eight-week trough of
79.740 plumbed earlier in the week.
Against the yen, the greenback rose to its highest in over
two weeks at 102.27. It was up 0.8 percent so far this
week, on track for its best performance in 2-1/2 months.
"The data supports expectations for the Fed to begin coaxing
the Fed funds rate higher by the middle of next year," analysts
at BNP Paribas wrote in a note to clients.
"Markets are now on alert for any change of message from the
Fed in response to the better data."
The U.S. two-year Treasury yield jumped to a 10-month high
and Wall Street hit a record high, with the Dow
ending above 17,000.
The euro, further weighed by a dovish-sounding European
Central Bank, shed more than half a U.S. cent to $1.3596.
It fell back from a one-month high against its Japanese
counterpart to 139.08, from 139.30.
The ECB, as expected, left interest rates steady at record
lows on Thursday but said it stood ready to do more if needed.
However, it sounded confident that a raft of policy measures
introduced last month will help lift inflation and support bank
The Australian dollar, already on the ropes after the
country's central bank said it was overvalued, fell to its
lowest in over two weeks.
The Aussie plumbed $0.9327, bringing the June 18
trough of $0.9322 into focus. It was last at $0.9345, well off
an eight-month peak of $0.9505 set early in the week.
Despite the jobs-inspired rally, the greenback dipped to a
fresh six-month low against its Canadian counterpart at C$1.0620
. It only managed a very slim gain on sterling, which
stayed near a six-year peak of $1.7180.
The honours for the worst major performing currency belonged
to the Swedish crown after the Riksbank cut its key interest
rates by an unexpectedly large 50 basis points to 0.25 percent.
Adding to the drama, governor Stefan Ingves had wanted a
quarter-point cut, but was outvoted by his rate-setting
That marked the first instance that the central bank chief
had been in a minority on a rate decision since the Riksbank
became independent in 1999.
The Swedish crown fell to its lowest against the
euro in almost three years, reaching 9.3900 crowns per euro from
9.1950. Against the dollar, it slumped to a two-year low of
6.8749 per dollar.
With U.S. markets shut on Friday for the Independence Day
holiday, Asia is unlikely to have the same level of action seen
overnight. Making matters worse, there is also no Asian data of
interest due for release.
(Editing by Shri Navaratnam)