The US dollar was weaker versus the euro and the yen on Friday after the Labor Department reported that 80,000 jobs were lost in the United States in March, more than had been expected by analysts.

At just before noon in New York the dollar was trading at $1.5730 to the euro while it was at ¥101.7450 in relation to the yen.

The yen was helped by a retreat from carry trades as investor sentiment was hurt by the US jobs report.

The yen traded at ¥160.0398 to the euro.

The pound was down in relation to the euro and the greenback on worries that recession in the US could hurt economic growth in the UK.

In late morning trade in New York the pound traded at 78.82p to the euro and at 50.11p to the dollar.

Meanwhile, the South African rand declined versus major currencies on the avoidance of carry trades.

Earlier in the week the rand was stronger on signs that Zimbabwe President Robert Mugabe could be on his way out of power after elections there.

Mugabe has presided over a weakening of the Zimbabwe economy that has left the inflation rate there at 164,000 percent.

In New York around noon the rand traded at R7.8035 to the dollar and at R12.275 to the euro.

The US dollar weakened versus the yen on Tuesday for the sixth session in a row on increasing sentiment that the Federal Reserve will cut US interest rates by three-quarters of a percentage point this month, to 2.25 percent.

Declines for the dollar also came after Fed chairman Ben Bernanke urged banks to write down more mortgage debt and forgive those debts to homeowners at risk of defaulting on their home loans.

The yen also gained on the euro during the day’s session, trading at ¥156.5302 to the euro and at ¥102.8350 to the dollar in late morning trade in New York.

The pound also gained on the greenback as analysts cut back on their estimates of how much the Bank of England will cut interest rates this year, going as high as $1.9891 to the pound before slipping back to $1.9859 to the pound just after 11 a.m. in New York.

The pound was weaker, however, versus the euro, trading at 76.65p to the shared currency in New York.

The Australian dollar declined versus its US counterpart as the Reserve Bank of Australia raised interest rates there to 7.25 percent but some analysts said that they believe rates will not go up again for awhile.

In addition, the Bank’s governor said that consumer spending in Australia seems to be moderating.

In late afternoon trade in New York, it cost 92.81 cents US to buy an Australian dollar.

Hedging is a way of reducing some of the risk involved in holding an investment.

There are many different risks against which one can hedge and many different methods of hedging.

When someone mentions hedging, think of insurance. A hedge is just a way of insuring an investment against risk.

Consider a simple case. Much of the risk in holding any particular stock is market risk; i.e. if the market falls sharply, chances are that any particular stock will fall too.

So if you own a stock with good prospects but you think the stock market in general is overpriced, you may be well advised to hedge your position.

There are many ways of hedging against market risk. The simplest, but most expensive method, is to buy a put option for the stock you own.

It's most expensive because you're buying insurance not only against market risk but against the risk of the specific security as well.

You can buy a put option on the market which will cover general market declines and/or you can hedge by selling financial futures.

The best (and cheapest) hedge is to sell short the stock of a competitor to the company whose stock you hold.

For example, if you like X company and think they will eat Y's lunch, buy X and short Y.No matter which way the market as a whole goes, the offsetting positions hedge away the market risk.

You make money as long as you're right about the relative competitive positions of the two companies, and it doesn't matter whether the market zooms or crashes.

If you're trying to hedge an entire portfolio, futures are probably the cheapest way to do so. But keep in mind the following points.

The efficiency of the hedge is strongly dependent on your estimate of the correlation between your high-beta portfolio and the broad market index.

If the market goes up, you may need to advance more margin to cover your short position, and will not be able to use your stocks to cover the margin calls.

If the market moves up, you will not participate in the rally, because by intention, you"ve set up your futures position as a complete hedge.

Another technique would be to sell covered calls on your stocks.

You won't be completely covered against major market drops, but will have some protection and ...

Some possibility of participating in a rally!