Dollar hits 4-year lows as US data disappoint By Jennifer Hughes in London Financial Times May 1 2003 The dollar slumped to fresh lows on Thursday following weak data, which led investors to eye today's payrolls data with renewed trepidation. The euro rose to a fresh high at $1.1198 against the dollar in Asian trading but settled at about $1.117 as UK traders - continental Europe enjoyed a May Day holiday - waited for the US numbers. Early in New York, the euro broke firmly above $1.12 after a closely-watched manufacturing survey showed activity contracted further last month compared with the slight bounce forecast by economists. The single currency peaked at $1.1287 by midsession in New York. Analysts noted the employment component of the ISM data fell further, boding ill for Friday's monthly payrolls report.  "If payrolls do fall, that will be the sixth decline in eight months," noted Ian Morris, economist at HSBC in New York. "However you cut it up, the recent trend is not good." The euro reached new highs against sterling and the Swiss franc early in European trading before definite profit-taking took it lower. On Wednesday, the dollar's weakness prompted a general rush into the single currency and buoyed it near its highs throughout the day. "The market has got itself long of euros very quickly again and was looking for other currencies to buy against the dollar," said Mansoor Mohi-uddin, chief foreign exchange strategist at UBS Warburg. The Australian dollar hit a new three-year high at US$0.6336 while the Canadian dollar pushed its US counterpart to a five-year low at C$1.416. Strategists said the key to the near-term direction of the "loonie," - as the Canadian currency is colloquially known - would be its closing levels this week. "It is setting itself up for either a push lower to C$1.3850 or a temporary bottom which will be determined by its ability to hold gains," said Tim Mazanec, senior currencies strategist at Investors Bank and Trust. The dollar fell to a month-low against the yen at Y118.18, prompting fresh speculation the Bank of Japan may renew its covert intervention of the first quarter to stem the yen's rise. Data released on Wednesday showed the BoJ had not intervened at all in April, surprising many in the market and sparking a fresh wave of short dollar-yen positions, according to traders. But fresh fears the BoJ could step in if the dollar slipped below Y118 helped the euro rise sharply in New York trading to a new four-year high at Y133.43 against the yen. "When dollar-yen moves more than two big figures in five working days, the chances of intervention rise significantly," warned Mr Mohi-uddin at UBS. The dollar was trading around Y120.4 against the yen on Monday