Dollar Rally Halts Before U.S. Jobs Report, Bernanke Speech

April 2 (Bloomberg) -- The dollar's two-day rally against the yen halted on speculation an industry report will show companies reduced employees and Federal Reserve Chairman Ben S. Bernanke will signal more interest-rate cuts.

The U.S. currency declined against the British pound before the ADP Employer Services data, a leading indicator for the government's April 4 payrolls report. The dollar was little changed against the euro before Bernanke's testimony on the economic outlook.

``Bernanke may say there is still great economic uncertainty,'' said Etsuko Yamashita, chief economist at Sumitomo Mitsui Banking Corp. in Tokyo, a unit of Japan's third- biggest publicly traded lender. ``His dovish comments, especially weaker-than-anticipated ones, are likely to trigger dollar-selling.''

The dollar traded at 101.81 yen at 8:45 a.m. in Tokyo from 101.85 late yesterday, when it touched 102.16, the highest level since March 12. Against the euro, the dollar was at $1.5609, after advancing 1.1 percent yesterday. The euro traded at 158.92 yen from 158.99. The pound rose to $1.9780 from $1.9759.

The Dollar Index traded on ICE futures in New York fell 0.1 percent to 72.527. The measure of the currency's value against those of six trading partners had the biggest advance since Dec. 14 yesterday after UBS AG and Lehman Brothers Holdings Inc. said they're raising a total of $19 billion, fueling speculation the world's largest financial institutions may weather credit market losses.

Jobs Market

ADP will probably report that companies lost 45,000 workers last month, following a reduction of 23,000 the previous month, according to the median forecast of 24 economists surveyed by Bloomberg News. The report is due today at 8:15 a.m. New York time. Nonfarm payrolls will fall by 50,000 in March after dropping by 63,000 in the previous month, according to a separate survey. The government will release the data on April 4.

Bernanke will speak today before the Joint Economic Committee of Congress at 9:30 a.m. in Washington.

``I don't see the economy shifting back into a growth mode,'' said Axel Merk, a fund manager at the $400 million Merk Hard Currency Fund in Palo Alto, California, in an interview on Bloomberg Radio. ``While we can have a rally from depressed levels, I don't see how structurally the dollar is on a sounder footing today than it was yesterday.''