The dollar fell against the euro on Thursday on worries that its recent rally on expectations for higher U.S. interest rates might have gone too far and on caution ahead of U.S. jobs data. Talk that Venezuela was moving its reserves out of U.S. Treasuries and that Russia may revalue the rouble to keep inflation in check also weighed on the dollar, traders said. A Venezuelan central bank director, Domingo Maza Zavala, was quoted in the Financial Times newspaper on Thursday as saying the country had transferred a large part of its $30.4 billion foreign reserves out of U.S. Treasuries over the last four months. Reuters had already reported on Monday, in an interview with Maza, that Venezuela had reduced U.S. Treasuries in its reserves. Traders said that market players used the Venezuela story as an excuse to take profits on the dollar's recent run higher ahead of the U.S. payroll figures on Friday. Economists surveyed by Reuters expected to see a loss of 129,000 jobs in September as layoffs in the wake of Hurricane Katrina offset gains in the rest of the country. The dollar had risen to 16-month highs against the yen and three-month peaks versus the euro earlier in the week on prospects for higher U.S. interest rates. By 0330 GMT, the euro bought $1.2050, up 0.6 percent from the level in late U.S. trade and well above the three-month low of $1.1900 hit earlier in the week on electronic trading platform Traders said the euro was bumped higher after it breached a series of stop-loss levels at and above $1.20. They also said talk of a Russian media report that the Russian central bank was contemplating revaluing the rouble had given the euro additional support. Reuters has not been able to verify the report. Against the yen, the dollar was slightly down at 113.85 yen, still in sight of the 16-month high around 114.40 yen marked on Wednesday. The dollar had risen on a chorus of comments from Federal Reserve officials expressing concern about U.S. inflation, supporting expectations the central bank would stick to its tightening campaign. The latest person to pipe up was Kansas City Fed President Thomas Hoenig, who said on Wednesday that U.S. policy-makers must be alert to price pressures, although he said a huge surge in inflation was unlikely. "The market is cautious about the speed of the dollar's rise but the scenario for the higher dollar remains," said Mitsuru Sahara, a senior trader at UFJ Bank. The euro rose about 0.6 percent to 137.25 yen. Traders said the single currency got a lift higher after stop-loss levels were taken out around 136.80 yen. Traders said demand from Japanese retail investors for foreign bonds boosted currencies with large rate advantages, such as the New Zealand dollar and the Australian dollar. Both currencies traded at levels not far from multi-year highs versus the yen hit earlier this week. The market will keep an eye out for rate decision announcements from the Bank of England and the European Central Bank later in the day, though both are expected to leave interest rates unchanged.