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Dollar struggles, euro off highs after PMI data

Published 10/24/2013, 05:41 AM
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Investing.com - The dollar was little changed near recent lows against the safe haven yen and Swiss franc on Thursday, as expectations that the Federal Reserve will hold off on tapering stimulus until next year continued to weigh.

During European morning trade, the dollar was trading close to two-week lows against the yen, with USD/JPY dipping 0.01% to 97.38.

The dollar briefly touched session highs against the yen earlier after data showed that manufacturing activity in China expanded at the fastest rate in seven months in October.

The preliminary reading of China’s HSBC manufacturing index rose to 50.9, up from a final reading of 50.2 in September. Economists had expected the index to tick up to 50.5.

The data helped offset fears over the Chinese economy, a day after market sentiment was hit by concerns that China’s central bank would tighten monetary policy to help control inflation.

The dollar was trading at 20-month lows against the Swiss franc, with USD/CHF slipping 0.11% to 0.8914.

The dollar remained under pressure after data earlier in the week showing that U.S. jobs growth slowed in September cemented expectations that the Federal Reserve would continue the current pace of its asset purchase program well into next year.

Elsewhere, the euro eased back from 23-month highs against the dollar, with EUR/USD up 0.14% to 1.3795, off highs of 1.3822.

The euro slid after data showed that manufacturing activity in the euro zone expanded at a slower than expected rate in October, indicating that the recovery remains sluggish.

The preliminary reading of the euro zone’s manufacturing purchasing managers’ index ticked up to 51.3 in October from a final reading of 51.1 in September, slightly below expectations for a reading of 51.4.

The euro zone services PMI fell to 50.9 this month from 52.2 in September.

The dollar was lower against the pound, with GBP/USD up 0.17% to 1.6190.

The greenback was mixed against its Australian and New Zealand counterparts, with AUD/USD inching up 0.02% to 0.9623 and NZD/USD slipping 0.29% to 0.8367.

The greenback pushed higher against the Canadian dollar, with USD/CAD easing up 0.13% to 1.0397.

The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, slipped 0.11% to 79.26.

Investors were looking ahead to U.S. data on initial jobless claims, the trade balance and new home sales later in the trading day.



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