Investing.com - The dollar extended gains against a basket of other major currencies on Monday, even after data showed that U.S. manufacturing activity expanded at the slowest pace in 13 months in February, as an upbeat U.S. growth report published on Friday continued to support.
In a report, the Institute for Supply Management said its index of purchasing managers fell to 52.9 last month from a reading of 53.5 in January. Analysts had expected the manufacturing PMI to decline to 53.0 in February.
Separately, the Commerce Department reported that U.S. consumer spending slid 0.2% in February after falling 0.3% in the previous month. Economists had forecast a 0.1% decline.
The dollar remained supported after the Commerce Department reported on Friday that U.S. gross domestic product grew at an annual rate of 2.2% in the last three months of 2014, down from an initial estimate of 2.6% but ahead of expectations for a downward revision to 2.1% growth.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, edged up 0.14% to 95.43.
EUR/USD pulled away from session highs of 1.1240 to hit 1.1198, steady for the day.
The single currency strengthened earlier, after Eurostat reported that the annual rate of consumer inflation declined 0.3% in February, better than forecasts for a drop of 0.4%, following a 0.6% decline the previous month.
Core inflation, which strips out food and energy costs, was unchanged from January at 0.6%.
Another report showed that the euro zone’s unemployment rate fell to a 33-month low of 11.2% in January, down from 11.3% in December. It was the lowest level since April 2012.
The euro’s gains were capped however, as investors turned their attention to the upcoming European Central Bank meeting on Thursday, where it was expected to announce details of its quantitative easing program.
The dollar was higher against the yen and the Swiss franc, with USD/JPY up 0.42% to 120.08 and with USD/CHF rising 0.38% to 0.9578.
In other trade, sterling pushed lower, with GBP/USD down 0.49% to 1.5363.
The pound showed little reaction to earlier data showing that activity in the factory sector rose to a seven-month high last month, indicating that the economic recovery is picking up after slowing at the end of last year.
The Markit manufacturing purchasing managers’ index rose to 54.1 in February from 53.1 in January. Economists had expected the index to tick up to 53.4.
Also Monday, the Nationwide Building Society said that U.K. house prices fell 0.1% last month, compared to expectations for a 0.3% rise, after an increase of 0.3% in January.
The Australian and New Zealand dollars remained broadly weaker, with AUD/USD declining 0.50% to 0.7769 and NZD/USD retreating 0.70% to 0.7515.
Meanwhile, USD/CAD gained 0.26% to 1.2546 after official data showed that Canada's current account deficit C$13.9 billion in the fourth quarter of 2014 from C$9.6 billion in the third quarter, whose figure was revised from a previously estimated deficit of C$8.4 billion.
Analysts had expected the current account deficit to narrow to C$7.4 billion in the last quarter.