TOKYO, Oct 3, 2008 (AFP) - The euro rallied in Asian trade Friday, pulling away from a 13-month low against the dollar as the market waited for key US jobs data and a pivotal vote on a revamped Wall Street bailout.

The euro also clawed back against the yen after hitting a two-year low on speculation about a possible cut in eurozone interest rates.

The dollar was at 105.28 yen in Tokyo afternoon trade, unchanged compared with its level in New York late on Thursday. The euro firmed to 1.3877 dollars from 1.3818 dollars and to 146.07 yen from 145.52.

Dealers said there were concerns that even if the US House of Representatives approves the 700-billion-dollar financial sector rescue package, it may not bring an end to the growing global economic turmoil.

Markets were also nervous ahead of a US employment report for September due out later in the day amid growing concerns about the impact of financial turmoil on the world's largest economy.

'The dollar is likely to fall broadly,' Hideki Amikura, a senior dealer at Nomura Trust and Banking, told Dow Jones Newswires.

'The employment data may turn out to be worse than expected because the jobless claims figures overnight logged surprisingly weak results.'

Dealers said it was also uncertain whether the US financial rescue plan would clear the US House of Representatives.

'If legislators reject the bill again, the dollar will likely face big plunges -- much bigger than those after the first refusal on Monday,' Amikura said.

Traders were waiting for further moves by policy-makers to try to shore up the economy and ease a credit squeeze, dealers said.

There is speculation that central banks in the United States, the eurozone and elsewhere may cut lending costs to try to keep credit flowing.

'Although the Fed has little room to manoeuvre in terms of monetary policy, a rate cut would be symbolic as a sign of cooperation with other monetary authorities,' said Sumitomo Trust Bank chief strategist Saburo Matsumoto.

The Fed's key rate is already low at 2.0 percent following a series of cuts since the financial crisis erupted more than a year ago.

The European Central Bank on Thursday kept interest rates unchanged at 4.25 percent but bank chief Jean-Claude Trichet signalled a readiness to lower official borrowing costs.

'We have seen a reduction in the upside risks of inflation,' Trichet said, marking a shift in the ECB's usual hawkish tone.

A slew of gloomy data across major industrialised nations has set recession alarm bells ringing in some of the world's biggest economies.

Next week financial ministers from the Group of Seven industrialised nations will meet in Washington and there are hopes they will come out with a strong message on cooperating to ease market anxiety, said Matsumoto.

Against regional Asian currencies, the dollar rose to 1,226.10 South Korean won from 1,222.90 on Thursday, to 34.19 Thai baht from 34.04, and to 1.4472 Singapore dollars from 1.4388.

It also firmed to 32.17 Taiwan dollars from 32.12, to 47.17 Philippine pesos from 46.85 and to 9,477.5 Indonesian rupiah from 9,425.