Investing.com - The dollar pared back gains against the yen on Wednesday, following the release of disappointing U.S. reports on private sector hiring and service sector activity, while the euro came off session lows against the greenback.
USD/JPY was last up 0.13% to 102.32 coming off session highs of 102.55.
The U.S. dollar weakened after the Institute of Supply Management said its services purchasing manager's index fell to a 43-month low of 51.6 last month from 54.0 in January. Analysts had expected the index to tick down to 53.5 in February.
The report came after ADP nonfarm payrolls data showed that the U.S. private sector added 139,000 jobs in February, well below expectations for an increase of 160,000.
The dollar had gained ground against the yen earlier as tensions over a standoff between Ukraine and Russia eased.
The euro trimmed losses against the dollar, with EUR/USD trading at 1.3736, up from lows of 1.3707.
The euro’s gain’s looked likely to be held in check ahead of the European Central Bank’s monthly meeting on Thursday amid concerns that the bank could tighten monetary policy.
The euro fell against the dollar earlier in the session despite data showing that euro zone private sector activity grew more rapidly than initially estimated in February, expanding at the fastest pace since June 2011.
A separate report showed that euro zone retail sales rose more strongly than forecast in January.
Elsewhere, the dollar was little changed against the Swiss franc, with USD/CHF dipping 0.01% to 0.8870.
GBP/USD was up 0.40% 1.6731. Sterling remained supported after data on Wednesday showed that activity in the U.K. service sector dipped in February, but growth remained robust.
The U.S. dollar was lower against the Canadian dollar, with USD/CAD down 0.32% to 1.1056. The Bank of Canada left rates on hold at 1.00% on Wednesday, in a widely anticipated decision.
The bank said economic growth in the fourth quarter of 2013 was slightly stronger than anticipated, adding that it still expects growth of 2.5% in 2014.
However, the bank also said inflation is expected to remain well below target for some time and the direction of the next change to the policy rate will be data dependent.
The Australian dollar was higher, with AUD/USD rising 0.31% to 0.8979, while NZD/USD was up 0.36% to 0.8419.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, slipped 0.08% to 80.10.