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Dollar rallies again as US services sector picks up

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The dollar rose for a second straight day on Wednesday as data showed stronger growth in US services activity and jobs.

[NEW YORK] The dollar rose for a second straight day on Wednesday as data showed stronger growth in US services activity and jobs.

The dollar rose 0.2 per cent against the euro at US$1.1488 per euro. Its advance against the yen was a stronger 0.4 per cent, to 107.03 yen.

US economic reports were mostly good, including rebounding factory orders, a shrinking trade deficit and a pickup in the massive services sector, including in employment.

On the other hand, the ADP private sector jobs survey for April came in as a disappointment, and raised worries about Friday's official jobs report for the month.

Omer Esiner of Commonwealth Foreign Exchange said the gains in the ISM services sector index helped the greenback.

"The fact the employment component was stronger than expected, that was positive for the dollar," he said.

However, he added, "A disappointing job number this week could really douse any expectations for a June rate hike and that would of course be very negative for the dollar."

AFP