The Dollar declines on speculation the U.S jobs report will come in the negative

The greenback fell against the yen on speculation a government report will show the U.S. economy lost the most jobs since 2003, bolstering the case for the Federal Reserve to lower interest rates. The U.S. currency also declined versus the British pound as future traders bet the Fed will cut borrowing costs by half a percentage point to 0.5 percent at its next meeting, compared with a U.K. benchmark rate of 3 percent. ``People are trimming bets on dollar gains before the payrolls data,'' said Tokichi Ito, deputy general manager of foreign exchange in Tokyo at Trust & Custody Services Bank Ltd., a unit of Japan's second-largest publicly traded lender. ``The focus is on fundamentals and there are serious doubts about the U.S. economy and corporate earnings.'' The EUR/USD is currently trading at $1.5690 as of 8:20am, GMT.

The Sterling was little changed against the euro, headed for a weekly decline, as yesterdays bigger-than- expected interest-rate cut by the Bank of England highlighted the depth of concern about the flagging British economy. The U.K. central bank, led by Governor Mervyn King, yesterday slashed its benchmark rate to 3 percent, the lowest level since 1955. The 1.5 percentage-point reduction was the most in 16 years. The GBP/USD is currently trading at $1.5710 as of 8:40am, GMT.

General Motors Corp., Ford Motor C0. and Chrysler LLC, strapped for cash as sales plunge, are seeking $50 billion in federal loans to help them weather the worst auto market in 25 years, a person familiar with the matter said. The package would be $25 billion for health-care spending and $25 billion for general liquidity that could be delivered in different ways, including short-term borrowing from the Federal Reserve, said the person, who asked not to be identified because the plan isn't public. In return, the companies would be willing to take steps such as granting stock warrants, the person said.

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