Dollar Rises Against Major Counterparts On Strong Service Sector Data

(RTTNews) - The U.S. dollar climbed higher on Tuesday, buoyed by data showing a slightly faster pace of growth of the nation's service sector in the month of August.

A report from the Institute for Supply Management showing the services PMI unexpectedly inched up to 56.9 in August from 56.7 in July, raised the possibility of an aggressive rate hike by the Federal Reserve.

Comments from Fed officials, including Chair Jerome Powell, are likely to be in focus in the coming days along with the central bank's Beige Book.

The dollar index rose to a fresh 20-year high at 110.55 after the released of the data from ISM, and despite paring some gains subsequently, the index remains firm around 110.30, gaining about 0.7%.

Against the Euro, the dollar has firmed to 0.9903 from 0.9933.

The dollar is trading at 1.1518 against Pound Sterling, strengthening from 1.1609. The pound climbed against its most major counterparts in the European session today, as U.K. Prime Minister Liz Truss is considering a support package worth 40 billion pounds in order to help businesses to lower their energy bills.

The new government is considering two proposals, which include placing a cap on wholesale gas prices.

The other plan is a percentage or unit price reduction offered by energy suppliers to firms.

Against the Japanese currency, the dollar is stronger, fetching 142.82 yen a unit, up from 140.59 in the previous session.

The AUD/USD pair is quoting at 0.6733, down from 0.6797. The Reserve Bank of Australia today increased the cash rate by 50 basis points as widely expected.

Against Swiss franc, the dollar has firmed to CHF0.9848 from CHF0.9798.

The Loonie, moving in a tight range against the U.S. currency, is down marginally at 1.3148 a dollar.