LONDON (AFX) - The euro was broadly lower in midday London trade as participants squared their positions ahead of the US non-farm payroll figures, due at 1.30 pm, dealers said. Earlier the euro had touched a new year high of 0.9488 against the dollar. "We are trading some 40 ticks from the highs, given the recent volatility, short-term accounts are squaring their positions ahead of the US labour market data," said Hans Redeker, analyst at BNP Paribas. Today's US employment report will be a focus. The AFX consensus forecast is for payrolls to rise 44,000 and for the unemployment rate to rise to 6.1 pct, its highest level since July 1994, from 6.0 pct in April. "Although there are benchmark revisions introduced in the May data, which increase the uncertainty, it doesn't seem likely that the numbers will alter the current perception that the US recovery is not strong enough at this stage to brind down unemployment," said Adrian Schmidt at the Royal Bank of Scotland. A combination of rising US unemployment and struggling equity markets is likely to keep the euro-dollar and euro-yen pairs firm, he added. For Redecker, the US equity markets are already trading with a very weak sentiment background. "A surprisingly weak labour market data would add to the negative sentiment in equity markets," he said. He said a break of the Dow Jones Industrial Average through the key 9,570 level, some 40 points lower than yesterday's closing level, would lead to some follow-through activity in the equity market. "Given the high correlation between the stock market and the dollar seen recently, it would mean that euro-dollar break through 0.95 usd," he added. Redeker believes that a break through the 0.95 usd would lead to some follow-through buying of the euro. "And again at 0.95 usd the option players would become short, which would lead to some follow through," he said. "For now the euro is the only game in town, but some caution is necessary because the data is not convincing," added RBS's Schmidt. Elsewhere, sterling was broadly steady versus the dollar and the euro amid a lack of news to trade on, while the yen was a touch softer against major currencies.