NEW YORK: The dollar rose on Wednesday, rebounding from recent lows against the yen and euro as data on U.S. trade and factory orders eased some worries about the sub-1 percent growth path the world's biggest economy was stuck on in the first quarter.
But a surprisingly weak report on private U.S. jobs growth in April and bets the Bank of Japan might not intervene soon to stem the yen's rise could help rekindle further losses on the greenback, analysts said.
The greenback sagged to a near 19-month low of 105.52 yen overnight and touched its weakest against the euro since last August at $1.1614 on Tuesday.
"We will see more momentum on the dollar downtrend unless there's a major upward surprise on Friday," said Ray Uy, head of macro research at Invesco in Atlanta, referring to the government's April payrolls report due later this week.
For now, the dollar has stabilized from its recent decline after the U.S. trade gap shrank to its smallest in 13 months in March and factory orders grew 1.1 percent, more than analyst forecasts.
Moreover, the Institute for Supply Management's gauge on the U.S. services industry rose to its highest since December.
Those figures overshadowed news from payroll processor ADP that companies added 156,000 workers in April, the smallest monthly gain in three years.
The dollar index which measures the greenback's value against the euro, yen and four other currencies, was up 0.3 percent at 93.205, rebounding from its lowest in more than 15 months on Tuesday.
The greenback rose 0.3 percent at 106.93 yen in thin trading, with Japanese markets shut on Wednesday and Thursday for Golden Week holiday.
Last week, the yen booked its biggest weekly gain since 2008, which was more than 5 percent against the dollar, as the Bank of Japan held off on more stimulus.
Position squaring ahead of U.S. jobs data due at 8:30 a.m. EDT (1230 GMT) on Friday likely supported the dollar against the yen for now, but it will not be enough to reverse the trend, analysts said.
"There's no incentive to long dollar/yen," said Jeremy Cook, head of currency strategy at World First in London.
In the futures market, speculators held $7.5 billion in bets on the dollar falling versus the yen, the second most net dollar/yen shorts going back to August 2012, according to Reuters calculations and data from the Commodity Futures Trading Commission released last Friday.
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