Dollar rises on strong ISM manufacturing report

December 03, 2013 | 10:35

(0) user say

The dollar Monday rose against major currencies after a good manufacturing report boosted speculation that the US Federal Reserve could taper its bond-buying program more quickly.

Photo showing US dollar notes. (AFP/Juan Barreto)

NEW YORK: The dollar Monday rose against major currencies after a good manufacturing report boosted speculation that the US Federal Reserve could taper its bond-buying program more quickly.

Near 2300 GMT, the euro fell to US$1.3538 from US$1.3587 Friday.

The dollar also jumped to 102.94 Japanese yen compared with 102.40.

The euro advanced to 139.36 yen from 139.16 yen.

The dollar got a lift after the Institute of Supply Management said its purchasing managers index among manufacturers in November rose to 57.3 from 56.4 the previous month, against expectations of a slight fall.

The ISM figures come ahead of a busy week of US economic news culminating with Friday's release of the November jobs report.

The ISM report "shifted expectations for Fed tapering," raising the possibility the Fed will scale back the program in December instead of in 2014, said Kathy Lien, a managing director at BK Asset Management.

The dollar could gain further strength from a strong jobs report, or if "leading indicators for (the jobs report) point to a stronger number," Lien said.

Currency analysts at Nomura also released a report that raised the possibility that the dollar could be "close to a turning point" and rally "after a sleepy few months with no direction."

Nomura cited a better US economic outlook in 2014 and a "generally orderly" rise in US bond yields in recent months compared with the spike earlier in 2013.

Among other currencies, the pound fell to US$1.6353 from US$1.6366.

The dollar bought 0.9090 Swiss franc, compared with 0.9059.

AFP

What the stars mean:

★ Poor ★ ★ Promising ★★★ Good ★★★★ Very good ★★★★★ Exceptional