* Euro/dollar, cable reverse climb from 2009 highs
* Profit-taking in other currencies partly boosts dollar
* Non-manufacturing data, factory orders below forecast
* Asian countries seen continuing to buy U.S. Treasuries (Adds comment, updates prices)
By Gertrude Chavez-Dreyfuss
NEW YORK, June 3 (Reuters) - The dollar rebounded from the year's lowest levels versus the euro on Wednesday as weaker-than-expected U.S. economic data and steep losses in stocks revived concerns that the road to recovery would be rocky.
The uncertainty about the global economy rekindled demand for the greenback as a safe haven and prompted profit-taking in other currencies, such as the euro, that investors had bought on the view that the worst of the financial crisis was over.
In addition, comments from Asian monetary officials earlier that Asian central banks would keep buying U.S. Treasuries even if the U.S. credit rating were to be cut also boosted the dollar, analysts said For story see [ID:nSP412010].
A warning by S&P on the UK's credit rating recently had raised fears that the United States could be next.
"The dollar is up today because of a combination of profit-taking and people paring back a little of the overexuberance in the market as a result of the global recovery story," said Melvin Harris, market analyst at Advanced Currency Markets in New York.
On Wednesday, markets participants had a reality check after an ADP report showed more than half a million U.S. private sector jobs were lost last month and the service industry, which accounts for about 80 percent of economic activity, contracted for the eighth straight month in May. [ID:nN03345672].
The reports have cast doubt on a growing view that the U.S. economy has turned the corner, analysts said, spurring investors to take profits in higher-yielding but riskier currencies such as the Australian and New Zealand dollars.
In late afternoon trading, the euro traded 1.1 percent
lower at $1.4151 on electronic trading platform EBS
DOLLAR SET FOR REBOUND
The ICE Futures' dollar index, which tracks the currency's moves against a basket of six currencies, rose 1.2 percent to 79.444 <.DXY>.
Sterling
The Australian dollar fell 2.6 percent to US$0.7996
But traders said after the dollar's steep losses in May, the U.S. currency had been poised for a rebound anyway.
The comments from Asian monetary officials on more U.S. Treasury buying provided investors an exit from short dollar positions. Traders viewed the comments as an expression of support for dollar-denominated assets from the nations that control about half of the world's currency reserves.
"Most people are taking risky trades off as some currency pairs hit key technical levels," said Sebastien Galy, senior currency strategist at BNP Paribas in New York.
"Still, the dollar's gains have been pretty moderate considering how much it has fallen." Galy expects the dollar to resume its downtrend as there has been no shift in expectations that a global recovery is under way.
Federal Reserve Chairman Ben Bernanke, in an appearance on Wednesday before the House of Representatives Budget Committee, said rising U.S. debt was contributing to a spike in longer-term interest rates and now was the time to start working on reining in deficits.
But as expected, he gave no clue as to whether the U.S. central bank would step up its purchases of government debt or mortgage-backed securities to offset the rising borrowing rates, something investors have been watching for. [nWEQ001068] (Additional reporting by Nick Olivari; Editing by Leslie Adler)