LONDON (AFP) - The dollar fell slightly against the euro and the yen on Monday as investors took profits following a pre-weekend rally that was sparked by robust US payrolls data.
The yen firmed after an upgrade to Japan's already brisk economic growth for the quarter to December, but dealers said the Japanese currency was on a downward trend.
The euro rose to 1.3175 dollars in European trading, from 1.3112 dollars late in New York on Friday. The dollar stood at 118.13 yen, from 118.29 yen late on Friday.
The foreign exchange market was awaiting a batch of US economic indicators later this week, including retail sales on Tuesday and consumer prices on Friday.
The dollar was buoyed Friday by US jobs and trade data which were seen as reducing the likelihood of the US Federal Reserve cutting interest rates any time soon, dealers said.
The US economy added 97,000 jobs in February, in line with market expectations, but upward revisions to past data and an unexpected drop in the unemployment rate supported the dollar.
"With a mixture of strong and weak elements the employment report was enough to further rekindle the appetite for risk which ensured another bout of yen selling," said Derek Halpenny, analyst at The Bank of Tokyo-Mitsubishi.
"That appetite for yen selling has not been threatened by the stronger than expected revised GDP report in Japan."
Japan's economy grew 1.3 percent in the three months to December from the previous quarters, faster than the 1.2 percent pace initially reported, according to official data.
Meanwhile, Friday's strong US jobs figures helped to boost the outlook for global growth, allowing risk appetite to build and the so-called "carry trade" to resume, dealers said.
Carry trades occur when money is borrowed in countries with low interest rates, such as Japan, to be invested in higher-yielding assets elsewhere and are seen as risky transactions.
"We are talking about a half recovery in the carry trade," noted analysts at Dutch banking group ABN Amro.
Carry trades have been pared back in the last week or so because of the uncertain outlook on global stock markets. That had propelled the yen to three-month highs against the dollar at the start of last week.
The euro was changing hands at 1.3175 dollars, against 1.3112 dollars on Friday, 155.63 yen (155.11), 0.6783 pounds (0.6786) and 1.6123 Swiss francs (1.6191).
The dollar stood at 118.13 yen (118.29) and 1.2280 Swiss francs (1.2347).
The pound was being traded at 1.9427 dollars (1.9318).
On the London Bullion Market, the price of gold dipped to 652.65 dollars per ounce, from 652.25 dollars late on Friday.
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