Dollar dips slightly as investors wait on the sidelines

NEW YORK, June 7 (Reuters) - The dollar edged lower on Monday as investors looked ahead to European and U.S. central bank meetings and U.S. inflation data after Friday's lower-than-expected jobs data.

Friday's U.S. jobs data had put pressure on the dollar as investors bet that jobs growth was not strong enough to raise expectations for the U.S. Federal Reserve to tighten its monetary policy. read more

There was little movement in major currency pairs and the S&P 500 was modestly lower without U.S. economic data to help give it direction on Monday. {.N]

The dollar index was down 0.1% while the euro was up slightly against the dollar, at $1.2177 .

"At this point it looks like the market really wants to be short dollars. To us it suggests there's a risk chasing this move. It's a crowded position. You've already got a sizeable chunk of the market that's net short U.S. dollars so if feels like we need a shakeout of those positions," said Bipan Rai, North America head of FX strategy at CIBC Capital Markets.

While Rai said there was "some risk the dollar will rally" he noted that investors are waiting for Federal Reserve's meeting next week.

The foreign exchange market sees no reason for the Fed to change its monetary policy, "so we’ve still got accommodative monetary policy in the United States," said Kit Juckes, head of FX strategy at Societe Generale.

Market participants will also be looking at U.S. inflation data and the European Central Bank meeting, both on Thursday. read more

Dovish rhetoric from ECB policymakers suggests the bank is in no hurry to slow the pace of buying under the 1.85 trillion euro ($2.24 trillion) Pandemic Emergency Purchase Programme (PEPP). read more

Speculators decreased their net short dollar positions in the latest week, according to calculations by Reuters and U.S. Commodity Futures Trading Commission data released on Friday.

Currency investors seemed to shrug off news that the United States, Britain and other rich nations reached a deal on Saturday to squeeze more money out of multinational companies such as Amazon (AMZN.O) and Google (GOOGL.O) and reduce their incentive to shift profits to low-tax offshore havens. read more

"It was expected they'd come to some kind of agreement," said CIBC's Rai, but he said investors were likely wary of making bets as "The road is long and has lots of risks."

The Australian dollar, which is seen as a proxy for risk appetite, was up 0.18% versus the U.S. dollar at 0.776 .

In cryptocurrencies, bitcoin was up 0.7% around $36,041 , while ether was up 2.6% at $2,780 .


Currency bid prices at 10:19AM (1419 GMT)

Additional reporting by Elizabeth Howcroft; editing by Emelia Sithole-Matarise and Timothy Heritage

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