* Dollar set to gain about 2% for the week, best since mid-March
* Oil surge, dire U.S. data supportive
* U.S. payrolls eyed at 1230 GMT
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
By Tom Westbrook
SINGAPORE, April 3 (Reuters) - The dollar edged toward a 2% weekly rise on Friday, boosted by a surge in the oil price and as investors sought safety amid the worsening economic fallout from the coronavirus pandemic.
The gains consolidate the dollar's strength after a rollercoaster end to last month, when it soared in a scramble for cash, then slumped as the U.S. Federal Reserve flooded the market with liquidity.
The largest ever daily rise in crude oil prices helped the greenback to its best day in two weeks against the euro on Thursday, since the United States is the world's top producer.
It held that ground to stand at $1.0836 per euro EUR= on Friday - ahead 2.7% for the week. Against a basket of currencies =USD the dollar is up 2% for the week so far at 100.270, its best performance since mid-March.
Moves in Asian trade were slight since traders are bracing for bad news when monthly U.S. payrolls data is published at 1230 GMT.
The coronavirus pandemic is worsening in the United States. As lockdowns extend, weekly jobless claims doubled to a massive 6.6 million last week. jobless numbers suggest that productive capacity is being eroded, said Seema Shah, chief strategist at Principal Global Investors in London.
"So when self-isolation measures are eventually lifted, economic activity will take that much longer to get back on its feet. The chances of a V-shape economic recovery are fading."
Pessimism kept the dollar firmer against most other major currencies apart from the Australian dollar AUD=D3 which was marginally stronger at $0.6065.
The New Zealand dollar eased 0.2% to $0.5909 and the pound GBP= was slightly softer at $1.2369. The dollar was steady at 108.00 Japanese yen JPY= .
Brief gains in oil-exposed currencies such as the Norwegian krone NOK= and Canadian dollar CAD=D3 mostly evaporated with some retracement of oil's gains amid doubts around supply cuts. O/R
BRACED FOR BAD NEWS
Global coronavirus cases surpassed 1 million on Thursday, with more than 53,000 deaths, according to a Reuters tally of official data. lockdowns extend, the economic pain is also growing and purchasing managers' index surveys due across Europe later on Friday are likely to be dire.
The median expectation for March U.S. payrolls is a 100,000 drop in employment, according to a Reuters' survey of economists, though many reckon there will be far uglier numbers to come as the data catches up to the damage in the real economy.
"The U.S. labour market has more or less collapsed," said Joe Capurso, currency analyst at Commonwealth Bank of Australia which is forecasting a 200,000 drop.
"Very large falls are coming in the following months, even if tonight's report is stronger than expectations."
That has relatively few betting against the dollar. A Reuters poll found a third of 63 analysts reckon on a fall from here, with the rest forecasting gains or consolidation. market currencies were mostly steady. EMRG/FRX
"There may be a sense of stabilization, but the market and macro backdrop has not become constructive for emerging markets yet, with still tight, albeit having eased somewhat, dollar liquidity, and a grim growth outlook," said Frances Cheung, Westpac's head of macro strategy in Asia.