Dollar on the jobs line
A look at the day ahead in European and global markets from Tom Westbrook:
Having just closed out its worst month since 2010, the dollar's bull run may be ending.
Since the Fed hiked 75 basis points in November, 10-year Treasury yields US10Y have fallen more than 50 basis points and mortgage rates have followed — erasing a fair chunk of the tightening.
Tracking yields lower, the dollar is heading towards the weekend down heavily on the yen for the week and eyeing smaller losses on the euro and most other currencies.
The next test is Friday morning's U.S. jobs report, where a downside surprise could rip the dollar down further. Economists expect about 200,000 jobs were added last month.
More than that, and it might put a leash on the bond rally and the brakes on the dollar's slide.
Markets in Asia were treading water ahead of the figure, and clinging on to optimism about China reopening - except in Japan where gains in the yen provided an excuse for profit taking in the stockmarket and the Nikkei (.N255) dropped 1.7%.
Stock buying, rocketing local rates and the retreat in the dollar also seem to have finally given a bid to the Hong Kong dollar USDHKD, which has bounced from the weak end to the middle of its trading band.
Key developments that could influence markets on Friday:
Economics: Germany October trade data, Euro zone Oct producer prices, U.S. November non-farm payrolls
Speakers: Fed's Barkin and Evans, ECB's de Guindos