TOKYO, Aug 9 Reuters The dollar hovered close to a oneweek high against major rivals on Friday, after the biggest drop in U.S. jobless claims in close to a year allayed fears of a looming economic downturn.

China39;s yuan gained following a strongerthanexpected inflation reading and a firmer official exchangerate fixing.

The U.S. currency was steady against the Japanese yen following a threeday rebound, supported by a spike in Treasury yields as Thursday39;s firmerthanexpected employment data spurred a paring back in bets for Federal Reserve interest rate cuts this year.

The yen and fellow safehaven currency Swiss franc hung near oneweek lows as Asian equities built on an overnight rally on Wall Street, while riskier currencies such as the Australian dollar and sterling stayed elevated.

Markets have endured a turbulent week, triggered in large part by surprisingly soft U.S. payrolls figures a week ago that sent global stocks tumbling, while demand for the safety of assets such as the yen and the Swissie sent the currencies surging to their highest levels since the start of the year on Monday.

The dollar edged down 0.1 to 147.08 yen as of 0450 GMT, on course for an advance of around 0.4 this week, despite Monday39;s precipitous 1.5 plunge.

It eased 0.1 to 0.8659 franc , on track for a 1 weekly advance.

Initial claims for state unemployment benefits fell 17,000 to a seasonally adjusted 233,000 for the week ended Aug. 3, the largest drop in about 11 months. Economists…