The dollar declined to a one-month low against the euro as a government report showed U.S. employers cut fewer jobs last month than economists forecast, reducing demand for relative safety. Canada’s currency advanced to the highest level versus the greenback since November on the nation’s unexpected addition of jobs in April. The yen slid versus all but two of the 16 most actively traded currencies tracked by Bloomberg and touched a seven-month low against Australia’s dollar this week as evidence the recession is easing spurred demand for higher yields. “The prevailing flow now is negative for the dollar, negative for the yen, positive for the commodity-linked currencies and higher yielders,” said Michael Woolfolk, senior currency strategist at Bank of New York Mellon in New York. “Right now, the report is given a positive spin by the market. The market is grabbing on the green-shoot rally.” The dollar lost 0.9 percent to $1.3508 versus the euro at 12:10 p.m. in New York, from $1.3390 yesterday. It touched $1.3517, the weakest level since April 6. The U.S. currency traded at 99.01 yen, compared with 99.12. The euro increased 0.7 percent to 133.58 yen, from 132.71. The euro-dollar exchange rate rose today above its 200-day moving average for the first time since December. A close above that level will probably lead the euro to advance to resistance in a range of $1.3530 to $1.3540, a breach of which would push the currency toward $1.3739, said Tom Fitzpatrick, chief technical analyst at Citigroup Inc. in New York. Resistance is an area where orders to sell a currency may be clustered. Technical analysts study patterns on charts to predict future moves. Weaker Yen The yen dropped 4.3 percent to 59.08 versus the New Zealand dollar and 3.8 percent to 75.22 against the Australian dollar this week as a more optimistic global economic outlook prompted investors to get funds in countries with low borrowing costs and buy assets where returns are higher. The Bank of Japan’s target lending rate of 0.1 percent compares with 3 percent in Australia and 2.5 percent in New Zealand. Japan’s currency touched 75.75 versus the Aussie yesterday, the weakest level since Oct. 7, and reached 59.51 against the kiwi, the weakest since April 6. Global stocks advanced on the U.S. jobs report, with the Standard & Poor’s 500 Index gaining 1.5 percent and the MSCI World Index increasing 1.2 percent. Treasuries rose, pushing the 10-year note’s yield down after it reached 3.37 percent, the highest level since November. Dollar Index The Dollar Index, which the ICE uses to track the greenback against the euro, yen, pound, Canadian dollar, Swedish krona and Swiss franc, fell 0.8 percent this week to 83.240. U.S. companies eliminated 539,000 jobs in April after a decrease of 699,000 in the previous month, the Labor Department reported today in Washington. The median forecast of 70 economists surveyed by Bloomberg was for a drop of 600,000. The unemployment rate increased to 8.9 percent. “Things are improving a little bit faster than people were expecting,” said Sebastien Galy, a currency strategist at BNP Paribas Securities SA in New York. “People have been so bearish on the euro in general. Indeed, what we’re seeing is euro-dollar breaking higher, and our recommendation is to buy the euro.” The euro may rise to $1.40 in two weeks, he said. The dollar was headed for a third weekly decline versus the euro, dropping 1.6 percent in the longest losing streak this year. Against the yen, the dollar was little changed, while the euro rose 1.5 percent. Hiring in Canada The Canadian dollar increased as much as 1.1 percent to C$1.1572, the strongest level since Nov. 5, on the Canadian labor report. The currency was up 2.3 percent this week. Employers in Canada added a net 35,900 workers in April after a reduction of 61,300 in the previous month, Statistics Canada said today in Ottawa. The median forecast of 24 economists surveyed by Bloomberg was for a drop of 50,000. Australia’s dollar headed for its 10th weekly advance against the greenback, trading at 76 U.S. cents in the longest winning streak since 2003. An expansion in Chinese manufacturing stoked optimism the global recession is abating. “China right now is a barometer for the economy,” said Jessica Hoversen, a foreign-exchange analyst at MF Global Ltd. in Chicago. “As long as the idea continues that the Chinese economy will be this Atlas in the global recovery, then you’re going to see tailwinds underpin the Aussie.” The Australian dollar may rise in the next two weeks to 78 U.S. cents, a level where the currency’s plunge paused in September, Hoversen said. Atlas was the giant in Greek mythology who was condemned to hold up the sky on his shoulders. The yen dropped 9 percent against the dollar this year after touching 87.13 in January, the strongest since 1995. Toyota Motor Corp., the world’s largest automaker, forecast today a second consecutive annual loss as the global recession curbed demand for new cars and the yen eroded the value of dwindling overseas sales.

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