* Dollar inches up but set for fourth straight weekly fall
* Yen pushed lower as Bank of Japan buys bonds
* U.S. payrolls expected to be show robust growth of 175,000
* Graphic: World FX rates in 2016 tmsnrt.rs/2egbfVh
By Marc Jones
LONDON, Feb 3 The dollar inched fractionally
higher on Friday and limped towards U.S. jobs data facing its
fourth straight weekly fall, adding to what has already been its
worst start to a year in three decades.
The U.S. currency has been hit hard by worries about both
Donald Trump's presidential style and a lack of clarity from the
Federal Reserve this week about when it is likely to next raise
The non-farm payrolls report due at 1330 GMT is expected to
show employers added 175,000 jobs in January, figures
that if achieved are likely to be robust enough to give markets
confidence in bets on a hike at least by June.
The dollar index, which tracks the greenback versus six top
currencies, was up 0.3 percent and back above 100 having
gained most of its the early traction against the yen
after the Bank of Japan made a surprise move to push down its
Having muscled its way up to 113.15 yen, the greenback then
caught a tailwind in Europe that lifted it against the euro, the
pound and the Swiss franc, although it couldn't quite overcome a
Norwegian crown which has now risen six weeks running.
It also made little difference to what was set to be the
dollar index's first unbroken run of four weekly falls in
two years, that has driven it down almost 3 percent since the
start of the year. The dollar fell 2.6 percent in January - its
worst showing since 1987.
"Markets are now really seeing the downside of Trump,
especially the immigration orders," said Rabobank U.S.-focused
economist Philip Marey.
He added the upcoming non-farm payrolls data should reassure
the Fed especially if broader employment and wage rates rise.
"But it is also important they know which way the fiscal winds
are blowing and of course they don't at the moment.
One of the main beneficiaries of the dollar's wobble has
been the euro.
It was set for its sixth week of gains in at $1.0741
and having gone as high as $1.0829 after the latest
signs growth and inflation is rising in the euro zone. That has
a read-across for the European Central Bank's stimulus
Britain's sterling was licking its wounds after a bruising
few days that have brought this year's mini-rally to a halt.
Having suffered its worst day since October on Thursday, it
was knocked again as data on the UK's dominant services sector
fell for its first time in four months. It squeezed
the pound below $1.25 and to 86 pence per euro
and was on course for near 1 percent weekly drop.
"It was surely too early for markets to expect a
significantly more hawkish narrative," from the Bank of England
which on Thursday signalled little urgency to raise UK interest
rates, analysts from Bank of America Merrill Lynch said.
"A benign interpretation of the Brexit process and strong UK
data had perhaps lulled the sterling market into a false sense
of near-term security."
For Reuters Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Reporting by Marc Jones; Editing by Tom Heneghan)