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FOREX-Yen drops as upcoming U.S. data puts Greek fears on hold

Published 02/07/2015, 03:09 pm
Updated 03/07/2015, 08:55 am
© Reuters.  FOREX-Yen drops as upcoming U.S. data puts Greek fears on hold
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* Flood of U.S. data including payrolls could point to rate hike

* Sunday's referendum could be flash point for Greece

* Kiwi plunges below 67 cents for first time in 5 years

By Ian Chua

SYDNEY, July 2 (Reuters) - The yen dipped in Asian trade on Thursday as the market geared up for a deluge of U.S. data that could back expectations for the Federal Reserve to lift interest rates and briefly steal the spotlight from the Greece's debt crisis.

The data, from durable goods to nonfarm payrolls, will be released later in the global day, with U.S. markers closed on Friday for the July 4 Independence Day.

Heralding the key payrolls data, the ADP National Employment Report on Wednesday showed private employers added 237,000 jobs in June, the biggest gain since December and ahead of the 218,000 forecast. ID:nL1N0ZH100

"The NFP numbers brought the conversation back to the normal market talk," said Bart Wakabayashi, head of foreign exchange for State Street Global Markets in Tokyo. "There is now more of a focus on the Fed again, while people wait to see what happens with Greece later on."

Prime Minister Alexis Tsipras on Wednesday urged Greeks to reject an international bailout deal, souring hopes of any breakthrough as markets looked ahead to Sunday's referendum that might decide Greece's future in the euro zone. ID:nL8N0ZH0TT

An opinion poll showed opposition to the bailout leading but, the gap has narrowed significantly as voters were confronted with the hardship resulting from the bank closure and capital controls.

Against the yen, the greenback fetched 123.34 JPY= , up 0.2 percent on the day and pulling further away from a five-week trough of 121.93 hit on Tuesday.

The euro rose about 0.3 percent on the day to 136.56 yen EURJPY=EBS , and also added about 0.2 percent to $1.1072 EUR= .

The dollar index .DXY edged down about 0.1 percent to 96.178, giving back some of its 0.8 percent gain on Wednesday.

The dollar notched up solid gains against commodity currencies, particularly the New Zealand dollar. The kiwi skidded below 67 U.S. cents for the first time in five years as a slide in dairy prices narrowed the odds on more rate cuts. ID:nL3N0ZH4P9

It fell as far as $0.6694 NZD=D4 , and was last down about 0.5 percent on the day at $0.6703.

Also under fire, the Canadian dollar slid to its lowest in over two months at C$1.2598 per U.S. dollar CAD=D4 in thin holiday trade on Wednesday, and came within a whisker of that level on Thursday. Canadian markets were closed on Wednesday for a public holiday.

The loonie was already in sellers' crosshairs after the Canadian economy unexpectedly shrank in April. Data on Tuesday showed gross domestic product fell 0.1 percent from March, confounding forecasts for a gain of 0.1 percent. The fourth consecutive monthly decrease bodes poorly for a second-quarter pick-up in growth that the Bank of Canada had expected. ID:nL2N0ZF1Q4

(Editing by Simon Cameron-Moore)

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