* Sources say SNB seen selling francs for euros in Asian time
* SNB declines comment
* Euro jumps from 15-month low vs Swiss franc
* Euro remains under pressure from fiscal worries
By Kaori Kaneko
TOKYO, Feb 5 Switzerland's central bank was seen
selling francs in Asian trading time on Friday, sending the euro
leaping higher after it hit a 15-month low against the franc and
helping it rise above an eight-month trough against the dollar.
The euro has been under relentless selling pressure in the
past month on concerns about sovereign debt problems in the euro
zone, first in Greece and then in Spain and Portugal.
Traders said the Swiss National Bank bought euros for francs
in a rare foray into Asian trading time, with the central bank
said to have traded on trading platform EBS. The euro shot to the
day's high at 1.4905 francs on EBS from about 1.4700.
It had earlier fallen as far as 1.4551 francs, its weakest
level since October 2008, and the market was already wary that it
had dropped to levels which might prompt central bank action.
The SNB, which intervened in 2009, has said in the past it
would continue to prevent any excessive rise in the franc as long
as there were deflationary risks.
A spokesman for the central bank declined comment.
"Given the SNB has intervened before, it is no wonder if the
central bank does it after the recent sharp appreciation," said a
trader at foreign bank in Tokyo.
"But it won't change the euro's broad weakness," he said.
The euro was later holding at 1.4730 francs EURCHF=R, up
0.6 percent on the day.
It climbed against the dollar as it jumped against the franc,
after hitting $1.3669 in earlier Asian trade, its lowest since
late May 2009. It was later trading down 0.1 percent on the day
at $1.3711 EUR=.
The dollar rose 0.7 percent to 1.0738 francs CHF=.
The euro's weakness was partly attributed to widening yield
spreads of Greek, Portuguese and Spanish bonds over German
The single currency was also pressured by comments from
European Central Bank President Jean-Claude Trichet that many
members of the euro zone will have large and sharply rising
fiscal imbalances. For details see [ID:nECBNEWS]
"The euro remains on a downward trend for the longer term
unless there is a convincing prospect of an improvement in the
euro zone fiscal troubles and a sense of relief on the euro
returns to the market," said Minoru Shioiri, chief manager for FX
trading at Mitsubishi UFJ Securities.
The dollar index .DXY=USD earlier surged to its strongest
in seven months as the euro's early fall accelerated its gains.
The index, a measure of the dollar's performance against six
major currencies, rose 0.3 percent to 80.122 after touching
80.283, its highest since mid-July 2009.
Markets are jittery after a fall on Wall Street on Thursday,
the euro zone's sovereign debt problems and an unexpected rise in
U.S. weekly jobless claims, coming just ahead of key U.S. monthly
jobs data later on Friday.
Although the weekly report does not directly impact the
monthly non-farm payrolls number, there could be downside risks.
Economists are forecasting 5,000 jobs were added to the economy
last month, with the market looking at the unemployment rate and
possible downward revisions to previous data. ECONUS
Analysts say the dollar is in an almost a "win-win"
situation, especially against the euro, on the job numbers.
If the numbers are better than expected the market will
likely buy the dollar against the euro and yen on the view that
the U.S economy will recover faster than the other G-3 economies
and the Federal Reserve is likely to move sooner than Europe or
But if the numbers disappoint, they could add to the risk
trade unwinding currently gripping markets and send the euro
lower against the dollar.
The Australian dollar AUD=D4 and the New Zealand kiwi
NZD=D4 edged up against the greenback after dropping to their
lowest in four and five months respectively on Thursday.
They also climbed 1 percent on the yen after plummeting the
Traders said there was some support from yen outflows related
to a Japanese mutual fund to invest in Brazilian shares.
The euro rose 0.5 percent to 122.91 yen EURJPY=R, after
hitting its lowest in a year at 121.57 yen on Thursday and
posting its worst day against the yen since late 2008.
The dollar rose 0.7 percent on the day to 89.70 yen JPY=
after hitting a seven-week low of 88.55 yen, weighed down by the
weaker-than-expected jobless claims data.
(Additional reporting by Satomi Noguchi, Masayuki Kitano and
Charlotte Cooper; Editing by Michael Watson)