The dollar held largely steady on Friday as bond markets stabilized and traders awaited key US jobs data expected to fuel speculation of an interest rate cut this month.

The dollar rose on Thursday and was on track for a second consecutive weekly gain in relatively quiet trading as investors refrained from making major moves ahead of the US jobs report.

Data released yesterday showed a higher-than-expected increase in US jobless claims. This data paves the way for the more important nonfarm payrolls report that will influence the Federal Reserve’s monetary policy decision this month.

The dollar index, which measures the US currency against a basket of six major currencies, was little changed, settling at 98.207 and heading for a 0.4 percent gain this week.

The dollar fell 0.2 percent to 148.22 yen. The euro rose 0.1 percent to $1.1656.

Labor Market Data

Several Federal Reserve officials said concerns about the labor market still support their stance favoring interest rate cuts, boosting expectations of imminent monetary easing. The US central bank is scheduled to meet on September 16-17.

A report from ADP Research Institute showed US private sector job growth was lower than expected in August.

Meanwhile, data showed initial claims for government benefits rose by 8,000 to a seasonally adjusted 237,000 for the week ending August 30. Economists surveyed by Reuters had expected 230,000 claims for that week.

According to CME’s FedWatch tool, traders now expect nearly 100 percent probability of a rate cut this month, up from 87 percent a week ago.

Recent rises in long-term Treasury yields have signaled growing concerns about the resilience of major economies from Japan to Britain and the US.

Those concerns eased on Thursday and Friday as yields retreated to lower levels.

The British pound advanced 0.1 percent to $1.3447. The Australian dollar rose 0.1 percent to $0.6525, and the New Zealand dollar increased 0.2 percent to $0.5855.