Investing.com - The dollar moved lower against the yen on Wednesday, but remained supported above 11-week lows, as investors remained cautious ahead of European central bank decisions on Thursday and Friday’s nonfarm payrolls report.
USD/JPY was down 0.31% to 101.32, holding above the 11-week lows of 100.74 reached on Tuesday.
Investors remained wary in the wake of a broad based selloff in emerging markets. Emerging markets rebounded on Tuesday, recovering from their sharp selloff in the past two weeks, with the Turkish lira and the South African rand rising more than 1% against the dollar.
Emerging markets have been hard hit by concerns over the impact of reductions to the Federal Reserve’s stimulus program and worries over a possible slowdown in China.
Markets were turning their attention to Friday’s U.S. jobs report for January after weak manufacturing data earlier in the week sparked fears over a slowdown in the economic recovery.
Elsewhere, EUR/USD dipped 0.04% to 1.3511. The euro remained under pressure after data last week showing that the annual rate of inflation slowed in January fuelled fears that the European Central Bank may tighten policy to stave off deflation, ahead of its upcoming policy meeting on Thursday.
The pound was lower against the dollar, with GBP/USD slipping 0.16% to 1.6298 ahead of U.K. data on service activity due for release later in the session.
The dollar edged higher against the Swiss franc, with USD/CHF inching up 0.09% to 0.9045.
The New Zealand dollar was lower, with NZD/USD down 0.44% to 0.8206. The pair rose to highs of 0.8256 overnight, the strongest since January 29, after data showed that the labor market strengthened in the fourth quarter.
Statistics New Zealand said the number of people employed in the three months to December increased by 1.1% or 24,000, after an additional 28,000 jobs were created in the third quarter. Market expectations had been for an increase of 0.6%.
The unemployment rate fell to 6.0% in the fourth quarter from 6.2% in the previous quarter, in line with market expectations.
The Australian dollar was also lower, with AUD/USD slipping 0.16% to 0.8912, but losses were held in check after the Reserve Bank of Australia shifted its monetary policy stance away from easing rates on Tuesday.
The Canadian dollar edged higher against the U.S. dollar, with USD/CAD slipping 0.13% to 1.1067.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, dipped 0.02% to 81.21.