US dollar pushes higher amid more growth signs

A man displays US dollar notes at a local currency exchange shop in Mumbai. (AFP/Punit Paranjpe)

NEW YORK CITY: The US dollar pushed higher for the fifth straight session Tuesday helped by fresh signs of firm growth in the United States and another push higher in dollar bond yields.

At 2100 GMT, the euro slipped to $1.3170, from $1.3193 late Monday.

The dollar climbed to 99.54 yen from 99.34, while the euro edged up to 131.14 yen from 131.07.

A surge in the ISM purchasing managers' index for the US manufacturing sector in August helped the yields spike on US Treasuries and encouraged dollar bulls.

The Institute for Supply Management (ISM) said its purchasing managers index for the manufacturing sector climbed to 55.7 in August from 55.4 in July; in June the index was 50.9.

That helped push the yield on the 10-year Treasury to 2.85 per cent, compared to 2.75 per cent on Friday (Monday was a holiday in US markets), while the 30-year rose to 3.78 per cent from 3.68 per cent.

"Today's ISM figure in the US was better than expected, and US rates are pushing higher across the entire curve," said Jens Nordvig of Nomura.

The dollar also found strength as key Republican leaders in the US Congress gave their endorsement for plans to carry out a punitive strike on Syria, for its alleged use of chemical weapons.

Nordvig said that Treasury yields and the dollar were being supported by the rising belief that economist Larry Summers will be nominated by the White House to succeed Federal Reserve Chairman Ben Bernanke.

Analysts and investors are predicting that Summers would be more aggressive in cutting back Fed stimulus for the economy than Bernanke.

The British pound rose to $1.5556 from $1.5549, while the dollar gained to 0.9364 Swiss francs from 0.9336 francs.