Forexpros – The U.S. dollar pushed higher against most of the other major currencies on Wednesday, after stonger-than-expected U.S. private sector employment data tempered expectations for another round of easing by the Federal Reserve.
During European afternoon trade, the dollar pushed higher against the euro, with EUR/USD slipping 0.10% to 1.2290.
The greenback gained ground after U.S. payroll processor ADP said private sector employment increased by a seasonally adjusted 163,000 in July, beating expectations for an increase of 120,000.
June’s figure was revised down to 172,000, slightly lower that the initial estimate of 176,000.
The upbeat data saw markets trim back expectations that the Federal Reserve would launch a third round of quantitative easing measures in the near-term, ahead of the conclusion of the central bank’s policy meeting later in the day.
The euro remained supported by lingering optimism that the European Central Bank will unveil major steps to counter the debt crisis in the euro zone at its policy meeting on Thursday.
The greenback was higher against the pound, with GBP/USD shedding 0.37% to hit 1.5618, after data showing that the U.K. manufacturing sector contracted more-than-expected in July.
The Markit/CIPS U.K. manufacturing purchasing managers’ index dropped to 45.4 in July, the lowest level since March 2009, from a downwardly revised 48.4 in June and well below forecasts for a reading of 48.7.
The weak data fuelled expectations for more monetary easing by the Bank of England in the coming months, after data last week showed that the U.K. economy contracted in the three months to June, extending the recession into a third quarter.
Earlier Wednesday, a report showed that U.K. house prices fell at the fastest annual rate in almost three years in July.
Elsewhere, the greenback edged higher against the yen and the Swiss franc, with USD/JPY inching up 0.09% to 78.19 and USD/CHF easing up 0.06% to 0.9768.
The greenback remained lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD slipping 0.16% to 1.0013, AUD/USD rising 0.18% to 1.0523 and NZD/USD climbing 0.44% to trade at 0.8123.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched up 0.01% to 82.73.
Later in the day, the Institute for Supply Management was to produce a report on U.S. manufacturing activity.
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