* Dollar hits fresh 2-month low versus yen
* Breaks below key chart support before key U.S. jobs data
* Weak number could see dollar drop towards 93 yen: analyst
* Dollar could recover on in-line or strong data
By Jessica Mortimer
LONDON, June 7 The dollar slid to a two-month
low against the yen on Friday, extending steep falls the
previous day, before jobs data that could push the U.S. currency
even lower if it comes in below forecast.
The dollar fell 1.6 percent to 95.52 yen on the EBS
trading platform, its lowest since early April, having suffered
its biggest one-day fall in three years on Thursday.
U.S. non-farm payrolls at 1230 GMT are expected to show a
170,000 rise in May, according to a Reuters poll.
Recent data has raised concern the jobs number could be weak
and weigh further on the dollar as the prospect of the Federal
Reserve reducing asset purchases soon looks more remote.
The dollar extended falls after breaking below a reported
options barrier at 95.50 and strong chart support at 95.40 yen,
the bottom of the daily Ichimoku cloud, a closely-watched
Traders and analysts said it risked further falls.
The jobs data is seen as particularly important because the
Federal Reserve has said it will only reduce its bond buying
when it sees a significant improvement in the labour market.
"A strong number would highlight the risk of tapering as
soon as September and would be dollar positive, but if we get a
number around 100-120,000 then this could mean the Fed would
rather wait," Citi G10 currency strategist Valentin Marinov said
He said 93 yen "could be on the cards" if the data was weak.
Recent weaker U.S. data has prompted investors to pare back
their very hefty bets on a stronger dollar placed on
expectations the Fed will tighten monetary policy.
But some analysts said the dollar's very steep falls meant
it could need a very disappointing number to push it even lower.
"A number even matching consensus could see the dollar get a
bit of a bid," said Daragh Maher, currency strategist at HSBC.
Against a currency basket the dollar was down 0.3
percent at 81.316, having hit a three-month low of 81.077 on
The euro edged up 0.1 percent to $1.3252, having hit
a three-month peak of $1.3306 on Thursday after European Central
Bank President Mario Draghi gave no hints that further monetary
easing was imminent.
But the euro slid against a broadly firmer yen,
which usually gains during financial uncertainty. It lost more
than 1.5 percent to hit 126.27 yen, its lowest since mid-April.