Yen falls as U.S. jobs gain dims refuge bid

Franc Levels

The euro may extend gains versus the franc after strengthening through a key resistance level at 1.2291 francs, said Peter Rosenstreich, chief foreign-exchange strategist at Swissquote Bank SA in Geneva. That represents the 38% retracement of the euro’s decline from January and February, he said, citing so-called Fibonacci analysis.

The next major resistance level is at 1.2345 francs, the 50% retracement of that drop, he said. Resistance refers to an area where sell orders may be clustered.

The pound weakened for the first time in three days against the dollar as 11 of the 39 economists surveyed by Bloomberg predict the central bank will increase its asset-purchase target to at least 400 billion pounds ($604 billion) from the current 375 billion pounds at the end of its policy meeting tomorrow.

“The risk, if there is a surprise at all, is that there will be more asset purchases and that will weigh on sterling,” said Raghav Subbarao, a foreign-exchange strategist at Barclays Plc in London.

Pound Down

The pound dropped 0.7% to $1.5029 after falling to $1.4986 on March 1, the weakest level since July 2010. The U.K. currency declined 0.2% to 86.41 pence per euro.

The increase of 198,000 in U.S. employment followed a revised 215,000 gain the prior month, figures from the Roseland, New Jersey-based ADP showed today. The median forecast of 41 economists surveyed by Bloomberg called for an advance of 170,000.

The U.S. jobless rate for February will be released on March 8. It is forecast to hold at 7.9%, while payroll jobs increased by 160,000, according to Bloomberg News surveys.

The dollar has gained 3% this year, the second-best performer among 10 developed market currencies measured by Bloomberg Correlation-Weighted Indexes. The yen is down 5.7% while the euro is up 1.2%.

Bloomberg News

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