* Jobs growth in August below expectations
* Dollar hits one-month high against yen
* Emerging market currencies jump on yield demand
(Recasts with market move, adds quotes, updates prices)
By Karen Brettell
NEW YORK, Sept 2 The U.S. dollar gained on
Friday, erasing earlier losses, as investors viewed the Federal
Reserve as still likely to raise interest rates in the coming
months, despite disappointing jobs growth in August.
Hawkish statements from Fed Chair Janet Yellen and Vice
Chair Stanley Fischer last week increased expectations before
the jobs data that the U.S. central bank is closer to raising
Most investors see a rate increase at the Fed's policy
meeting later this month as a long shot, with the December
meeting seen as the most likely time for a hike this year.
"The jobs data is not weak enough to get people to give up
on their Fed view," said Marc Chandler, global head of currency
strategy at Brown Brothers Harriman in New York.
Nonfarm payrolls rose by 151,000 jobs last month, the Labor
Department said on Friday, below the 180,000 jobs that
economists had expected.
The dollar index, which measures the greenback
against a basket of six major currencies, rose 0.28 percent to
95.904, after earlier falling to 95.189, the lowest level since
The greenback also jumped 0.98 percent to 104.27 yen,
the highest level since July 29.
The dollar's reaction reflected low expectations that the
Fed would hike in September, despite the more bullish tone taken
recently by Fed officials.
"There was a degree of trepidation going into the numbers
that we may not get the validation for a rate hike that the
rhetoric would argue for," said Daragh Maher, head of FX
strategy, U.S., at HSBC in New York.
(Editing by Nick Zieminski and Paul Simao)