Investing.com - The U.S. dollar remained higher against almost all of its major counterparts on Wednesday, following the release of mixed U.S. data on employment and service sector activity as diminished expectations for U.S. easing and fresh concern over the euro zone debt crisis supported the greenback.
During U.S. morning trade, the dollar was sharply higher against the euro, with EUR/USD tumbling 0.90% to hit 1.3115.
Sentiment on the euro was hit by fresh concerns over Spain after a poorly received auction of Spanish government debt earlier saw the country’s borrowing costs rise.
Spain’s Treasury auctioned EUR2.59 billon of government bonds, short of the maximum targeted amount of EUR3.5 billion, in the country’s first debt auction since last week’s austerity budget.
Following the auction, the yield on Spanish 10-year bonds climbed to 5.7%, up from 5.5% before the sale.
On Tuesday, Spain’s government announced that the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Meanwhile, concerns over the outlook for growth in the euro zone mounted following a flurry of weak economic data.
In the U.S., the Institute of Supply Management said its non-manufacturing purchasing manager's index declined by 1.3 points to 56.0 last month from a reading of 57.3 in February.
Analysts had expected the index to decline by 0.3 points to 57.0 in March.
Earlier in the day, payrolls processing firm ADP reported that the U.S. private sector added 209,000 jobs last month, outstripping expectations for an increase of 200,000.
February’s figure was revised up to a gain of 230,000 from a previously reported increase of 216,000.
The reports came one day after the minutes of the Fed’s March meeting showed that policymakers will refrain from launching a third round of quantitative easing unless the rate of U.S. growth falters or inflation drops below the central bank’s 2% targeted rate.
The greenback was also up against the pound, with GBP/USD shedding 0.27% to hit 1.5869.
The pound remained supported, following a report showing that the U.K. service sector expanded more-than-forecast in March, adding to hopes that the economic recovery is gaining traction.
The greenback was down against the safe haven yen, but posted steep gains against the Swiss franc, with USD/JPY losing 0.46% to hit 82.43 and USD/CHF jumping 0.81% to hit 0.9171.
Elsewhere, the greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD adding 0.49% to hit 0.9958, AUD/USD dropping 0.71% to hit 1.0257 and NZD/USD falling 0.63% to hit 0.8137.
Sentiment on the Australian dollar was hit after official data showed earlier that the country posted a trade deficit of AUD0.48 billion in February, disappointing expectations for a surplus of AUD1.12 billion and fuelling fears over an economic slowdown.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, rose 0.62% to hit 80.03.
Also Wednesday, the European Central Bank left its benchmark interest unchanged at 1.00%, in a widely expected decision.
Following the decision, ECB President Mario Draghi said that growth has “stabilized at low levels” and that a moderate recovery is expected in course of the year.
During U.S. morning trade, the dollar was sharply higher against the euro, with EUR/USD tumbling 0.90% to hit 1.3115.
Sentiment on the euro was hit by fresh concerns over Spain after a poorly received auction of Spanish government debt earlier saw the country’s borrowing costs rise.
Spain’s Treasury auctioned EUR2.59 billon of government bonds, short of the maximum targeted amount of EUR3.5 billion, in the country’s first debt auction since last week’s austerity budget.
Following the auction, the yield on Spanish 10-year bonds climbed to 5.7%, up from 5.5% before the sale.
On Tuesday, Spain’s government announced that the country’s public debt will rise to a record 79.8% of gross domestic product this year.
Meanwhile, concerns over the outlook for growth in the euro zone mounted following a flurry of weak economic data.
In the U.S., the Institute of Supply Management said its non-manufacturing purchasing manager's index declined by 1.3 points to 56.0 last month from a reading of 57.3 in February.
Analysts had expected the index to decline by 0.3 points to 57.0 in March.
Earlier in the day, payrolls processing firm ADP reported that the U.S. private sector added 209,000 jobs last month, outstripping expectations for an increase of 200,000.
February’s figure was revised up to a gain of 230,000 from a previously reported increase of 216,000.
The reports came one day after the minutes of the Fed’s March meeting showed that policymakers will refrain from launching a third round of quantitative easing unless the rate of U.S. growth falters or inflation drops below the central bank’s 2% targeted rate.
The greenback was also up against the pound, with GBP/USD shedding 0.27% to hit 1.5869.
The pound remained supported, following a report showing that the U.K. service sector expanded more-than-forecast in March, adding to hopes that the economic recovery is gaining traction.
The greenback was down against the safe haven yen, but posted steep gains against the Swiss franc, with USD/JPY losing 0.46% to hit 82.43 and USD/CHF jumping 0.81% to hit 0.9171.
Elsewhere, the greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD adding 0.49% to hit 0.9958, AUD/USD dropping 0.71% to hit 1.0257 and NZD/USD falling 0.63% to hit 0.8137.
Sentiment on the Australian dollar was hit after official data showed earlier that the country posted a trade deficit of AUD0.48 billion in February, disappointing expectations for a surplus of AUD1.12 billion and fuelling fears over an economic slowdown.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, rose 0.62% to hit 80.03.
Also Wednesday, the European Central Bank left its benchmark interest unchanged at 1.00%, in a widely expected decision.
Following the decision, ECB President Mario Draghi said that growth has “stabilized at low levels” and that a moderate recovery is expected in course of the year.