* Yen suffers broadly after Kan comments on weaker currency
* Aussie rallies after strong Australian sales data
* Market awaits U.S. jobless figures on Friday
(Adds comment, updates prices)
By Naomi Tajitsu
LONDON, Jan 7 (Reuters) - The yen fell against the dollar
and other currencies on Thursday after Japan's new finance
minister said he wanted it to weaken more, stirring talk the
government may be more inclined to stem any sharp yen rise.
The Australian dollar rallied broadly, hitting a one-month
high versus the dollar and climbing to its strongest against the
yen since September 2008 after strong retail sales data
bolstered the case for another interest rate rise next month.
Speaking after his appointment as finance minister, Naoto
Kan said on Thursday that many Japanese firms were in favour of
dollar/yen around 95 yen, higher than the pair traded in the
latter part of 2009. []
He added he would work with the Bank of Japan to bring the
yen to an appropriate level, triggering broad selling in the
Japanese currency and pushing dollar/yen to the day's high.
"The comments were very aggressive and the yen sell-off is
appropriate ... Kan's view of where dollar/yen should be makes
sense," said Paul Mackel, director of currency strategy at HSBC
in London.
"The new comments put further fuel in the fire to push the
yen lower and the trend in yen weakness is going to continue."
The dollar's rally against the yen helped boost the U.S.
currency across the board, but gains were capped as traders
braced for U.S. payrolls data due on Friday, which was seen
providing stronger direction for currencies in the new year.
By 1043 GMT, the dollar traded 0.6 percent higher on the day
at 92.90 yen, near the day's high around 92.95 yen.
The yen tumbled broadly, pushing the euro <EURJPY=R> up
around 0.3 percent to the day's high of 133.57 yen.
The Australian dollar <AUD=D4> rallied as high as $0.9268,
its strongest since early December, on the back of data showing
Australian retail sales in November grew a surprisingly strong
1.4 percent. [].
Those figures pushed the Australian currency to a two-year
high of 0.6415 euros <AUDEUR=R> and extended its gains against
sterling <GBPAUD=> to $1.7312, its highest since 1985.
The euro <EUR=> slipped 0.4 percent to the day's low of
$1.4341 according to Reuters data, shrugging off a jump in euro
zone economic sentiment in December [].
Other figures showed a unexpected fall in monthly retail
sales in the 16-country bloc, which markets took as a sign that
euro zone interest rates will stay low [].
Strength in the dollar was reflected in its value against a
basket of currencies, which rose 0.5 percent <.DXY>.
The euro <EURCHF=> hit its weakest against the Swiss franc
in nearly 10 months around 1.4767 francs, before recovering to
1.4820 as traders became jittery about the possibility the Swiss
central bank may step in to curb strength in the currency.
PAYROLLS AWAITED
Dollar gains were limited as traders awaited Friday's
payrolls report for December, which could help shape the outlook
for when the U.S. Federal Reserve raises interest rates.
The report is expected to show the economy shed 8,000 jobs
in December, after a surprisingly small 11,000 drop in November,
a Reuters poll showed. []
The U.S. currency lost ground against the euro on Wednesday
when minutes from the Federal Reserve's latest policy meeting
suggested more economic stimulus measures were possible.
Some analysts said Fed officials may have a darker view of
the economy than some recent economic data suggests.
"We believe (the market's reaction to the minutes) is more
an indication of the misplaced pessimism of the FOMC at
present," analysts at BTM UFJ wrote in a note.
They said U.S. Challenger employment data on Wednesday
showed job cut announcements in the fourth quarter were the
lowest since Q4 2000, suggesting the prospect for an improvement
in the jobs market remains high.
(Editing by Nigel Stephenson)
