The euro fell to a four-month low against the dollar on Friday ahead of U.S. jobs data and next week's bond issues from euro zone peripheral countries, while world stocks and copper eased. A surprise sharp increase in U.S. private sector job creation in December have raised expectations of stronger non-farm payrolls for the month, with economists now expecting 175,000 jobs were created, up from 140,000 earlier, according to Reuters. The broader hopes that has prompted of a more sustained economic recovery continued to boost the dollar ahead of the data, due at 1330 GMT. Many analysts, however, said markets had become so upbeat on the payrolls that there was scope for disappointment. Some pointed to a note of caution from new U.S. claims for jobless benefits, which rose more than expected last week. "The consensus estimates suggest that U.S. non-farm payroll figures will show a rise of about 175,000, but the whisper figure is far higher than that. I think you have some room for disappointment," said Koen De Leus, strategist at KBC Securities in Brussels. "If it's a blow-out (high) figure, then the positive momentum can go on for a while." European shares eased, while U.S. stock index futures were down about 0.2 percent. The dollar gained 0.3 percent against a basket of major currencies, and 0.2 percent to 83.53 yen. The euro dropped 0.2 percent to $1.2975 after trading as low as $1.2965 on trading platform EBS, its lowest since mid-September. Copper hit two-week low on talk that top consumers China may be preparing to tighten monetary policy, and gold slipped for the fifth day in a row. EURO ZONE PERIPHERALS Investors sold bonds of the most indebted euro zone governments before a series of issues next week. An EU proposal that could force those who lend to banks to bear big losses should they fail also helped knock the single currency lower across the board. Portugal, widely seen as the next euro zone state at the risk of needing a bailout after Greece and Ireland, will lead a series of debt auctions from European nations next week. "Next week's supply in Spain, Portugal and Italy will be a good test of investor sentiment," said Nick Stamenkovic, strategist at RIA Capital Markets in Edinburgh. Yields on Portugal's 10-year government bonds over benchmark German Bunds rose 15 basis points to 433 bps, while those on 10-year Spanish bonds over Bunds widened by 6 bps to 264 bps. The five-year cost of insuring Portugal's debt against default rose 15 bps to 540 bps. Portuguese stocks fell 1.2 percent and Spain's blue chips dropped 1.5 percent, while the pan-European FTSEurofirst 300 index shed 0.4 percent. "The rising yields at debt auctions in the euro zone will continue to spook investors for a while, and it's best to stay away from peripheral stocks such as Spanish and Portuguese banks until mid-year when the crisis should ease," said Arnaud Scarpaci, fund manager at Agilis Gestion in Paris. World stocks measured by MSCI All-Country World Index slipped 0.3 percent, down for the third straight session. In Asia, Japan's Nikkei average edged up 0.1 percent to a fresh eight-month closing high. Copper fell for the fourth straight session, down 1.5 percent and was set for a 2.7 percent drop for the week. Gold eased 1 percent and is down 4.2 percent this week.
