LONDON (AFX) - The euro edged higher against the dollar in early trade as investors wait to see whether this afternoon's release of US nonfarm payroll figures will fuel fears of a double-dip recession in the world's biggest economy, dealers said. They noted the dollar's fall yesterday on disappointing Institute of Supply Management manufacturing activity and consumer spending figures from the US. "Far weaker-than-expected US economic data raised worries that the US economy may head for a double-dip recession," WestLB's Michael Klawitter said. "Given the ramifications of such a scenario for foreign demand for US assets, the drop in the dollar is little surprising," Klawitter said. "With the employment component in the ISM index declining significantly, the risk in today's labour market report is also to the downside," he said. 4Cast currency strategist Paul Bednarczyk too said the nonfarm payroll figures "could be a little gloomy" and could trigger further dollar selling. "However, we probably need to see a negative payroll number to really give dollar-selling a push," he said. Commerzbank's Kamal Sharma observed that "predicting nonfarm payrolls remains a lottery, but one thing that all the economists are sure is that they will rise today". Sharma added: "Payrolls remains a highly significant data release and this could determine the direction of the dollar over the next few trading sessions." The AFX News consensus forecast is for a modest gain in nonfarm payroll employment of 66,000 in July after payrolls rose 36,000 in June. The unemployment rate is expected to remain steady at 5.9 pct. In the euro zone, business and consumer surveys are expected to echo the message in yesterday's purchasing managers' index for the manufacturing sector that the recovery is running out of momentum. "Today's euro zone data is likely to confirm the sluggish growth scenario and consequently should not offer any support to the euro," Klawitter said. Bear Stearns economist David Brown said: "Euro zone sentiment data today should mirror the slide in the PMI surveys that we saw yesterday." In the UK, the PMI equivalent for the construction sector will be watched for interest rate clues following yesterday's decision by the Bank of England's Monetary Policy Committee to leave monetary policy unchanged for the ninth consecutive month.