Dollar Gains Against Rivals

WASHINGTON (dpa-AFX) - The U.S. dollar firmed up against most major currencies on Monday, amid slightly easing fears about the coronavirus.

Data showing an unexpected expansion in U.S. manufacturing activity in the month of January supported dollar. The report from the Institute for Supply Management said activity expanded for the first time in several months in January.

The ISM said its purchasing managers index surged up to 50.9 in January after slipping to a revised 47.8 in December, with a reading above 50 indicating growth in manufacturing activity.

Economists had expected the index to show a more modest increase to a reading of 48.5, which would have still indicated a contraction.

Traders also noted the Chinese central bank's measures to support the financial markets of the country.

The dollar index rose to 97.89 and was last seen at 97.84, up 0.47% from previous close.

Against the Euro, the dollar strengthened to $1.1063, gaining about 0.3%, after data showed that Eurozone manufacturing contracted at the slowest rate in nine months in January as the decline in output, new orders and purchases eased and business confidence improved.

The euro area purchasing managers' index, or PMI, for the manufacturing sector climbed to 47.9 from 46.3 in December, final survey data from IHS Markit showed on Monday. The flash reading was 47.8.

The reading has remained below 50 for 12 months now, but the latest score was the highest since April 2019.

The Pound Sterling was down sharply against the dollar, with a unit of sterling fetching $1.2996, against Friday's close of $1.3204.

Britain's manufacturing sector stabilized at the start of the year, led by gain in new orders, employment and business confidence as the political uncertainty subsided after the general election.

The seasonally adjusted Purchasing Managers' Index, or PMI, for the manufacturing sector climbed to a nine-month high of 50.0 in January, which was slightly higher than the flash reading of 49.8, survey data from IHS Markit and the Chartered Institute of Procurement & Supply showed on Monday.

The U.K. exited the European Union at 11 pm on Friday, and has now begun an 11-month transition period during which it expects to strike a trade deal with the bloc.

UK Prime Minister Boris Johnson's warning that he might walk away from talks with the European Union, in the event of Britain not getting a free trade agreement, has raised concerns about a hard Brexit again. Johnson said he wants a free-trade agreement similar to the terms the bloc has with Canada, imposing no tariffs or quotas on trade in goods.

Britian would be ready to take a looser arrangement like Australia's if talks fail, he said.

Against the Japanese Yen, the dollar strengthened to 108.69 yen, rising from 108.34 yen.

The dollar was little changed against the Aussie with the pair trading at 0.6691.

Against the loonie, the dollar was notably higher at 1.3291, while it was up by about 0.3% against Swiss franc at 0.9662.

Copyright RTT News/dpa-AFX