Dollar gains as eurozone activity slows

The US dollar has strengthened after news that the Federal Reserve policymakers rejected an early rise to the Fed's benchmark interest rate. I

The US dollar has picked up strength against the euro after a key measure of eurozone business activity weakened slightly.

Around 2300 GMT on Thursday (1000 Friday AEDT) the dollar was at $1.3718, compared to $1.3733 late on Wednesday.

The dollar was flat against the yen at 102.32 yen, while the euro slipped to 140.37 yen from 140.50 yen.

The dollar also gained on the British pound, with the pound falling to $1.6653 from $1.6680.

The dollar was helped by Wednesday's news that Federal Reserve policymakers had last month discussed - but ultimately rejected - an early rise to the Fed's benchmark interest rate.

In addition, the Markit Economics eurozone purchasing managers index for February fell to 52.7 points from 52.9 in January, against expectations of a slight increase.

Markit's services PMI edged up to 51.7 points in February from 51.6 in January while the manufacturing PMI dropped sharply to 53 from 54.

"A dip in the eurozone PMI provides a reminder that the region's recovery continues to be uneven and fragile," chief Markit Economist Chris Williamson said.

Williamson noted that growth "continued to be led by Germany, which contrasts with a worrying renewed downturn in France," despite a better export performance.

"There is a risk of the French economy contracting again in the first quarter," he said.


2 min read

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Updated

Source: AAP


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