Dollar flat ahead of payrolls

THE dollar was trading in a narrow range this morning ahead of the release of US unemployment figures tomorrow (AEDT).

THE dollar was trading in a narrow range this morning ahead of the release of US unemployment figures tomorrow (AEDT).

At midday, the dollar was trading at US97.63c, up almost US1c from yesterday's close of US96.65c.

Since 5pm yesterday, the local unit traded in a range between US97.50c and US97.76c.

Commonwealth Bank currency strategist Joe Capurso said the local currency traded within a "tight" range of less than three tenths of a US cent this morning.

"Markets are just waiting for US payrolls (data) tonight," Mr Capurso said.

"It's going to be a quiet night in Europe until the numbers are released."

The subdued morning activity came after the dollar opened almost US1c higher on positive global sentiment after strong performances on equity markets overnight.

The euro and European shares were sharply higher on Thursday as surprisingly strong US home sales offset disappointment at a lack of fresh stimulus action from the European Central Bank.

US non-farm payrolls data will be released overnight during the offshore session. The median market forecast is for unemployment to remain stable at 9.6 per cent.

Mr Capurso said if the figures showed the US labour market was recovering, that would see investors move into US dollars and put pressure on the local currency.

He predicted a quiet afternoon of trade.

"We'll just be waiting until tonight," he said.

Meanwhile, the bonds market was weaker at noon.

At midday on the ASX 24, the December 10-year bond futures contract was at 94.510 (implying a yield of 5.490 per cent), down from yesterday's close of 94.570 (5.430 per cent).

The December three-year bond futures contract was at 94.980 (5.020 per cent), down from 95.030 (4.970 per cent) yesterday.