Sterling eased back towards this week's one-month low against the dollar on Friday ahead of a U.S. jobs report seen as key to the greenback's recovery. The pound steered a relatively steady course against the euro at 66.98 pence , just under a penny away from one-year highs scaled on Wednesday. "Technically, sterling is looking heavy against the dollar but there is little appetite to take fresh positions ahead of the payrolls," said Nick Parsons, currency strategist at Commerzbank. Jobs have been a weak spot in the U.S. economic recovery and the market is looking for signs of stronger growth in payrolls to prompt the U.S. Federal Reserve to raise interest rates and make dollar returns more attractive. The consensus forecast is for a rise in payrolls of 125,000 in February compared with 112,000 in January, though some in the market are looking for a stronger figure after a manufacturing survey earlier this week pointed to a recovery in job creation. Sterling was down a quarter-percent at $1.8190 at 0850 GMT, less than half a cent away from one-month lows hit on Wednesday.
A newspaper report that Britain's Chancellor of the Exchequer Gordon Brown was being lined up as a possible new head of the International Monetary Fund provided much talk on trading floors but little currency reaction. Britain's Treasury dismissed it as premature speculation. "The Brown story throws up a risk that has previously not been priced in, but the market seems to be shrugging it off for the moment," said Parsons.///