Dollar steady as focus turns to US payrolls, yen intervention jitters persist

The dollar held steady on Thursday as markets awaited key ​U.S. non-farm payrolls data, while the yen's slide to 40-year lows against the greenback and thin trading ‌ahead of a U.S. holiday kept traders on high alert for intervention, Reuters reported.

The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, eased 0.02% to 101.38.

Thursday's data is expected to show U.S. employers added 110,000 jobs in June, with the unemployment rate holding steady at 4.3%, according to the median estimate of economists polled by Reuters.

Federal Reserve Chairman Kevin Warsh said on Wednesday inflation expectations and price risks have eased in recent weeks, while the ⁠ADP National Employment Report showed that private employment rose but less than expected.

That being said, "If the payrolls data exceed market expectations, the dollar could accelerate higher on a rebound," said Mitsubishi UFJ Bank senior analyst Akihiko Yokoo in a note.

The dollar has been underpinned by rising expectations of Fed rate hikes this year. A resilient labour market has also bolstered the outlook for U.S. growth, after job gains exceeded expectations for the past three months. That has added to other sources of dollar support, including the rapid adoption of AI, which has helped draw capital into U.S. assets.

The euro traded at $1.138 against the U.S. dollar while sterling edged 0.06% higher to $1.3279.