U.S. non-farm payroll data is scheduled to be released at Friday’s session and the labor market is expected to show increased strength over the previous surveys.
A possible gain of 175,000 jobs for June is anticipated, but some analysts forecast that the number could be higher.
The June rebound from May's weak 38,000 should include a reversal of the negative impact of the Verizon strike, which cut into May's number and should add about 35,000 workers to the June report.
Dollar, Yen Down
The dollar index, which tracks the greenback against a basket of six major rivals, was down 0.1 percent at 96.246 but was heading for a 2.1 percent gain in a week marked by volatile trade in the wake of Britain's surprise vote to exit the European Union last month.
The safe-haven yen also slipped as investors wondered whether the Bank of Japan will decide to take further stimulus action at its policy meeting next Thursday and which steps might be taken.
The U.S. jobs data is especially important since the surprising slowdown in May hiring was one of the reasons cited by the Fed for leaving interest rates unchanged at its meeting last month. The June report could confirm the slowing trend or show it to be an anomaly and this will have a key impact on markets for weeks to come.
According to Joseph LaVorgna, chief U.S. economist at Deutsche Bank, "It does appear to be a noticeable downshift in job growth. Historically, when unemployment gets near 5 percent, job growth slows." LaVorgna expects the employment report which is to be released at 8:30 a.m. EDT Friday to show an increase of 155,000 nonfarm payrolls.