Forexpros – The U.S. dollar pushed broadly lower against its major counterparts on Monday, despite the release of weak U.S. data as renewed hopes for an agreement to arrest the spread of the debt crisis in the euro zone boosted risk appetite.
During U.S. morning trade, the dollar was down against the euro, with EUR/USD climbing 0.61% to hit 1.3473.
The euro extended early gains after French President Nicolas Sarkozy and German Chancellor Angela Merkel said they favored a change to European Union treaties in order to enforce stricter budget rules and restore investor confidence in the single currency zone.
Their proposals will be discussed at an EU summit meeting scheduled to take place in Brussels on Thursday and Friday.
The euro had found support earlier after Italian Prime Minister Mario Monti unveiled a EUR30 billion package of austerity measures, designed to reduce the second-biggest debt load in the single currency bloc.
The greenback was also lower against the pound, with GBP/USD advancing 0.62% to hit 1.5693.
Earlier in the day, U.K. data showed that service sector activity rose unexpectedly in November, advancing for the eleventh successive month although at a modest pace as incoming new business increased at the slowest rate of the year so far.
The Markit/CIPS Purchasing Managers’ Index for the service sector rose to 52.1 in last month from 51.3 in October, confounding expectations for a dip to 50.5.
Elsewhere, the greenback was weaker against the yen and the Swiss franc, with USD/JPY sliding 0.20% to hit 77.82, and USD/CHF shedding 0.42% to hit 0.9173.
The greenback was also lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD declining 0.59% to hit 1.0132, AUD/USD surging 0.84% to hit 1.0297 and NZD/USD rising 0.66% to hit 0.7824.
In Australia, industry data showed that job advertisements were flat in November while a separate report showed that company operating profits fell less-than-expected in the third quarter.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.54% to hit 78.33.
Earlier in the day, a report showed that service sector activity in the U.S. declined unexpectedly in November, slumping to the lowest level since January 2010.
The Institute of Supply Management said its non-manufacturing PMI fell by 0.9 points to 52.0 last month, from 52.9 in October.
Analysts had expected the PMI to rise by 0.5 points to 53.4 in November.
A separate report showed that U.S. factory orders declined more-than-expected in October, falling for the second consecutive month.
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