Investing.com - The dollar rose against most major global currencies on Wednesday as investors shrugged off weak U.S. manufacturing data released by the Institute for Supply Management and went long on the greenback as a safety play ahead of a European Central Bank meeting scheduled for Thursday.
Australian gross domestic product figures missed expectations, which further fueled a risk-off trading sentiment.
In Asian trading on Wednesday, EUR/USD was down 0.24% at 1.2536.
Markets are waiting to see if the European Central Bank will announce plans to buy sovereign bonds issued by countries like Spain and Italy to ease the debt crisis.
The euro and other higher-yielding currencies fell against the greenback earlier as investors held off on more definitive trading strategies and sought shelter in the safe and liquid dollar until that ECB announcement comes.
Meanwhile, eurozone retail sales figures are due out later Wednesday, which further pushed investors to greenback positions until the numbers hit the wire and give markets a better glimpse into the health of the European economy and whether or not the ECB will move forward with plans to buy bonds.
Uncertainty concerning Europe offset weak manufacturing data out of the U.S.
In the U.S. earlier, the Institute for Supply Management said its purchasing managers' index fell by 0.2 points to 49.6 in August from a reading of 49.8 in July.
Analysts had expected the ISM index of purchasing managers to gain 0.2 points and hit 50.0.
The report added that new orders fell while inventories rose, indicating that sales are softening, while the number of new workers hired fell to the lowest level since late 2009.
The numbers stoked already growing expectations that the Federal Reserve will stimulate the U.S. economy, likely with a third round of quantitative easing.
Under quantitative easing, the Fed buys assets such as Treasury holdings or mortgage-backed securities from banks, pumping the financial system full of liquidity to push down interest rates and encourage investing and hiring.
Such accommodative policies tend to weaken the dollar by design and send other currencies climbing.
The greenback, meanwhile, was flat against the pound, with GBP/USD trading at 1.5872.
The dollar was up against the yen, with USD/JPY trading up 0.02% at 78.45, and up against the Swiss franc, with USD/CHF trading up 0.23% at 0.9580.
The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.03% at 0.9862, AUD/USD down 0.17% at 1.0208 and NZD/USD down 0.03% at 0.7942.
in Australia, official data showed that gross domestic product grew 0.6% in the second quarter, missing analysts' calls for 0.7% growth.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.13% at 81.46.
Investors will spend later Wednesday preparing for the Friday release of the August nonfarm payroll report in the U.S.
Australian gross domestic product figures missed expectations, which further fueled a risk-off trading sentiment.
In Asian trading on Wednesday, EUR/USD was down 0.24% at 1.2536.
Markets are waiting to see if the European Central Bank will announce plans to buy sovereign bonds issued by countries like Spain and Italy to ease the debt crisis.
The euro and other higher-yielding currencies fell against the greenback earlier as investors held off on more definitive trading strategies and sought shelter in the safe and liquid dollar until that ECB announcement comes.
Meanwhile, eurozone retail sales figures are due out later Wednesday, which further pushed investors to greenback positions until the numbers hit the wire and give markets a better glimpse into the health of the European economy and whether or not the ECB will move forward with plans to buy bonds.
Uncertainty concerning Europe offset weak manufacturing data out of the U.S.
In the U.S. earlier, the Institute for Supply Management said its purchasing managers' index fell by 0.2 points to 49.6 in August from a reading of 49.8 in July.
Analysts had expected the ISM index of purchasing managers to gain 0.2 points and hit 50.0.
The report added that new orders fell while inventories rose, indicating that sales are softening, while the number of new workers hired fell to the lowest level since late 2009.
The numbers stoked already growing expectations that the Federal Reserve will stimulate the U.S. economy, likely with a third round of quantitative easing.
Under quantitative easing, the Fed buys assets such as Treasury holdings or mortgage-backed securities from banks, pumping the financial system full of liquidity to push down interest rates and encourage investing and hiring.
Such accommodative policies tend to weaken the dollar by design and send other currencies climbing.
The greenback, meanwhile, was flat against the pound, with GBP/USD trading at 1.5872.
The dollar was up against the yen, with USD/JPY trading up 0.02% at 78.45, and up against the Swiss franc, with USD/CHF trading up 0.23% at 0.9580.
The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.03% at 0.9862, AUD/USD down 0.17% at 1.0208 and NZD/USD down 0.03% at 0.7942.
in Australia, official data showed that gross domestic product grew 0.6% in the second quarter, missing analysts' calls for 0.7% growth.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.13% at 81.46.
Investors will spend later Wednesday preparing for the Friday release of the August nonfarm payroll report in the U.S.