Dollar Rises Against Major Counterparts After ISM Services PMI Data
(RTTNews) - The U.S. dollar firmed against its major counterparts on Wednesday after data showing an acceleration in U.S. service sector activity in the month of August raised the prospect of the Federal Reserve holding its interest rate higher for longer.
A report from the Institute for Supply Management showing an unexpected acceleration in the pace of U.S. service sector growth in the month of August.
The ISM said its services PMI rose to 54.5 in August from 52.7 in July, with a reading above 50 indicating growth in the sector. The increase surprised economists, who had expected the index to edge down to 52.5.
The data has added to recent concerns about the outlook for interest rates, as the report also showed an acceleration in the pace of price growth.
Crude oil prices rose to a 10-month high, fueling concerns about inflation and supported the greenback.
The dollar index climbed to 105.02 around mid morning, but pared gains subsequently and was last seen at 104.84, up marginally from the previous close.
Against the Euro, the dollar firmed to 1.0751 before easing to 1.0726, netting a marginal loss. Against Pound Sterling, the dollar strengthened to 1.2505 from 1.2565.
The dollar was down marginally against the Japanese currency to 147.66 yen, recovering from 147.02 yen.
Against the Aussie, the dollar is roughly flat at 0.6380. The Swiss franc is weak at CHF0.8915 a dollar, while the Loonie is trading at C$1.3640 a dollar.
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