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Dollar gains against major currencies following economic reports

Dollar gains against major currencies following economic reports

The dollar rose against most major currencies Wednesday, even after reports on U.S. manufacturing and services provided new evidence that the economy may be slowing.
The euro bought $1.2713 in afternoon New York trading, down from $1.2727 in New York late Tuesday. The British pound slipped to $1.8864 from $1.8872.
The dollar was unchanged against the Japanese currency at 117.89 yen.
On Wednesday, the Commerce Department said that orders to U.S. factories for manufactured goods were little changed in August following a 1 percent decline in July.
Meanwhile, the Institute of Supply Management reported that its gauge of activity in U.S. service industries dropped more than expected in September.
Despite the reports, the dollar held its ground against the major currencies, buoyed by rebounding consumer confidence, falling oil prices and record highs from the Dow Jones industrials, said Michael Woolfolk, a senior currency strategist at the Bank of New York.
"We're starting to see dollar stability against the majors," Woolfolk said. "What we have is mixed data that hasn't yet confirmed the dire forecasts of a hard landing in 2007."
However, slowing growth has convinced most economists that the Federal Reserve will keep interest rates unchanged for the rest of the year.
Rising rates have boosted the dollar for the past two years as the Fed sought to keep growth from fueling inflation. Higher rates can bolster a currency by making certain types of investments more attractive.
The European Central Bank is widely expected to lift its key interest rate when it meets Thursday. It would be the fifth such move since the bank started adjusting rates in December 2005. The Bank of England also meets Thursday.
In other New York trading, the dollar bought 1.2484 Swiss francs, up from 1.2451 late Wednesday, and 1.1263 Canadian dollars, up from 1.1206.


Updated : 2021-04-23 22:10 GMT+08:00