* Strong US fundamentals seen keeping euro on defensive vs dollar
By Shinichi Saoshiro
TOKYO, June 4 (Reuters) - The dollar was elevated on Monday after the release of an upbeat U.S. jobs report, although uncertainty over potential political risks kept the currency’s near-term outlook murky.
The dollar index against a basket of six major currencies stood steady at 94.171 after gaining about 0.2 percent on Friday.
Closely watched data out on Friday showed U.S. jobs growth gathering pace and wages rising in May, making a rate hike by the Federal Reserve in June a near certainty and increasing expectations of a fourth hike this year.
The dollar added 0.15 percent to 109.660 yen following a rise of 0.6 percent on Friday.
The robust U.S. jobs report helped offset a variety of factors that had weighed on the dollar earlier last week, such as Italy’s political turmoil and a flare up in trade tensions between the United States and its allies.
“The jobs report was strong but other recent U.S. data also point to strong fundamentals, helping the dollar recover losses suffered from risk aversion. Uncertainty over the U.S.-North Korea summit next week is still likely to cap the dollar’s upside,” said Shin Kadota, senior strategist at Barclays in Tokyo.
The euro was a shade higher at $1.1665 after losing roughly 0.3 percent on Friday.
The single currency still remained in sight of a 10-month low of $1.1510 set earlier last week when concerns over Italian politics peaked in the global markets.
“While worries over Italy may have subsided somewhat, the bottom line is that the U.S. economy is doing better than its European peers, and this will continue to weigh on the euro,” Kadota at Barclays said. The prospect of a snap election in Italy shook investor risk sentiment at the start of last week. But markets gained some composure after anti-establishment parties reached a deal to resurrect their proposed coalition government, averting potentially destabilising elections.
The Australian dollar was 0.15 percent higher at $0.7581 while the New Zealand dollar dipped 0.1 percent to $0.6983. (Reporting by Shinichi Saoshiro Editing by Eric Meijer)