(Recasts, updates prices, adds comment, data, changes byline,
dateline; previous LONDON)
* U.S. non-farm payrolls show big upside surprise, but wages
* Fed still on track to raise rates 3 times this
By Gertrude Chavez-Dreyfuss
NEW YORK, Feb 3 The dollar edged lower against
yen and euro on Friday in choppy trading after the U.S.
employment report showed a smaller-than-expected rise in wages
last month despite strong jobs gains, raising doubts about the
strength of the economy.
The report though was positive overall, analysts said, and
should keep the Federal Reserve on track for multiple rate hikes
Data showed that January non-farm payrolls rose by 227,000
jobs, the largest gain in four months. But the unemployment rate
rose one-tenth of a percentage point to 4.8 percent and wages
increased modestly, suggesting that there was still some slack
in the labor market that would keep dollar-negative inflation in
"I think the biggest miss here is that wages were
considerably soft, although I don't think this will delay the
Fed," said Omer Esiner, chief market analyst, at Commonwealth
Foreign Exchange in Washington.
Average hourly earnings rose just 0.1 percent, lower than
the market's forecasts for a 0.3 percent increase. There was
also a downward revision to the December wage growth, suggesting
the Fed might not rush to hike rates again.
In morning trading, the dollar index, which tracks the
greenback versus six top currencies, was flat at 99.821.
Against the yen, the dollar was down 0.1 percent at 112.74
The euro, meanwhile, was up slightly against the dollar at
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Alden