* New Fed chief with dovish history to testify in Congress
* Weak U.S. jobs data fails to deter Fed taper expectations
* Norwegian crown gains vs euro as data reduce rate-cut
By Richard Leong
NEW YORK, Feb 10 The dollar held steady against
major currencies on Monday as traders waited to hear the
economic and policy views of Janet Yellen, the new head of the
Federal Reserve, following a disappointing January report on
the U.S. labor market.
Yellen, who is viewed as an architect of the U.S. central
bank's current ultra-loose policy, will make her first
appearance as Fed chair before Congress Tuesday and Thursday.
"It doesn't provide a lot of incentive to move the dollar
out of its current trading range," said Bob Lynch, head of G10
FX strategy at HSBC Bank USA in New York.
The dollar index last traded down 0.02 percent at
80.671 after hitting its lowest in about 1-1/2 weeks.
The greenback was mildly weaker versus the yen at 102.16 yen
, down 0.2 percent on the day. This followed a choppy
session on Friday where the dollar managed a 0.2 percent gain
against the safe-haven Japanese currency, rebounding from an
initial sell-off due to data that showed a second straight month
of below-forecast jobs growth.
The euro was flat against the dollar at $1.3632 and
fell 0.2 percent against the yen at 139.23 yen.
While analysts anticipate U.S. lawmakers will question
Yellen, the first female head of the Fed, on subjects from
monetary policy to bank regulations, they reckon she will stick
to replies that would not alter expectations the Fed will hold
short-term rates near zero for an extended period to support the
Nor do analysts foresee she would say anything to upset
expectations the Fed will back away from its tapering of its
massive bond-purchase stimulus even after news U.S. employers
added only 113,000 workers last month, far fewer than the
185,000 increase forecast by analysts.
The Fed has reduced its third round of quantitative easing
twice, to $65 billion in February and Wall Street widely expects
monetary policy-makers to taper by another $10 billion a month
at their March meeting.
"The market is not indicating it's expecting any policy
changes. I'm not sure we're going to get anything new," HSBC's
In other G10 currency action, Norway's crown advanced
against the euro and dollar after higher-than-expected inflation
was read as eliminating the chances of an interest rate cut.
Georg Von Wowern from Scandinavian bank Nordea said Norway's
central bank would look past the inflation numbers, which were
influenced by post-Christmas sales.
But he said the crown, which fell almost 15 percent last
year against the euro, had been looking oversold and may have
room to regain more ground.
"We continue to think the crown is vulnerable, but there is
the possibility of more of a correction in the short term," Von
The crown rose about 0.5 percent from Friday versus the
dollar and euro at 6.1402 crowns to the dollar and
8.3711 crowns per euro.