TOKYO: The dollar held its gains Friday as dealers await US jobs data, after Japan's prime minister left open the door for a market intervention to tame the soaring yen.
While the April US jobs report is expected to show a slowdown in new posts, pointing to a softening in the world's top economy, speculation that the Federal Reserve could lift interest rates as early as next month have have buoyed the greenback.
"In order to maintain the rebound in the dollar, a solid payrolls release would likely need to be accompanied by stronger-than-expected average hourly earnings growth," Kymberly Martin, a markets strategist at Bank of New Zealand, said in an e-mail to clients.
"This could prompt the market into increasing its expectations for Fed rate hikes this year."
In Tokyo, the greenback fetched 107.11 yen, slightly off 107.26 in New York but still above 18-month lows around 105.55 yen touched Tuesday.
The euro bought $1.1406 against $1.1404 in US trade and well down from Tuesday's high above $1.16.
The single currency was also at 122.14 yen, against 122.32 yen in New York.
The Tokyo market reopened after a three-day national holiday, during which Japanese officials travelling overseas attempted to talk down the yen's strength.
Prime Minister Shinzo Abe said Thursday on a visit to London that "drastic fluctuations" in the yen's value risked having a major negative impact on Japanese companies.
And in Frankfurt on Tuesday, Finance Minister Taro Aso also voiced concerns that "one-sided, unbalanced and speculative moves are becoming stronger" before reiterating that Japan would "act" if necessary.
Aso previously said Japan could intervene in forex markets to stem the yen's steep rise, and that it would not breach a G20 agreement to avoid competitive currency devaluations.
Japan last waded into forex markets in November 2011, as the yen's rise threatened an economic recovery from the quake-tsunami disaster earlier that year.
Emerging market currencies were broadly lower, with the South Korean won down 0.5 percent against the dollar and Indonesia's rupiah 0.1 percent lower.
The Australian dollar was down almost one percent as it continues to feel the effects of this week's shock interest rate cut by the country's central bank.
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