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The dollar fell against its competitors responding on weak data on business activity in the U.S. service sector

January 7, 2014, Tuesday, 12:07 GMT | 07:07 EST | 16:37 IST | 19:07 SGT
Contributed by Forex-Metal

Asian and European trading sessions:
Euro: The rate of the euro retreated from a session high against the dollar, while returning to the opening level of today's session. The data on business activity influenced the trading course of the euro. It was shown that the growth in the euro zone's private sector has been accelerated in December, with the support of a significant improvement in the manufacturing sector. It became known from the final data, which were published today by Markit Economics. The seasonally adjusted composite index that measures the performance in the industrial sector and the service sector rose to a three-month high in December - to the level of 52.1 points, compared with 51.7 in November. The last result corresponded to preliminary estimates. The recovery headed high in the manufacturing sector, where growth accelerated to the highest level since May 2011. Meanwhile, it became known that the purchasing managers' index for the services sector fell slightly - to 51.0 points in December from 51.2 in November. The latter figure was in line with the preliminary estimates. The slowdown reflected continuing weakness in some domestic markets. The EUR / USD pair rose to $ 1.3620, but then decreased slightly during the European session.
British Pound: The pound regained some lost ground against the dollar, but still continued to trade with a noticeable decrease. The original currency weakness was due to the expectations of the British publication data, and amid volatile trading. As it became known, the growth in the UK services sector unexpectedly slowed in December, against which the corresponding figure fell below 59 points. However, experts note that the confidence grew and the economy can still record its strongest expansion since 2007 last year. According to the report, the monthly purchasing managers index (PMI) for the service sector fell to a six-month low in December - to the level of 58.8 points, contrary to the predictions of experts on the growth to the level of 60.4 points from 60.0 points in November. However, this figure remains well above the 50 mark that divides growth from contraction. The business confidence about the future rose to its highest level since March 2010 - the corresponding index was 73.5 points, helped by an increase in new orders. The GBP / USD pair fell to $ 1.6335 during the European session.
Japanese Yen: The yen traded upward against the dollar, although it has lost some of the previously captured positions. For the Japanese yen helped report, which showed that business activity index for non-manufacturing sector grew in Japan last month, registering with the fourteenth consecutive monthly expansion. According to the report , published today by Markit Economics the business activity index for the services sector rose to 52.1 points in December , compared with November's three-month low of 51.8 points . This result indicates a slight acceleration of growth in business activity, as well as a continuation of a series of extensions, which lasts for 14 consecutive months. The USD / JPY pair rose to Y104.75 during the European session.
American trading session:
U.S. Dollar: The dollar fell against its competitors responding to the not too optimistic data on business activity in the U.S. service sector. As we learned from the report, which was submitted to Markit Economics, activity in the U.S. service sector continued to grow steadily in December, albeit slightly lower than anticipated. According to the report, the final index of business activity for the services sector amounted to 55.7 points in December, compared with the initial reading at the level of 56.0 points, and the final value of November at around 55.9 points. The experts had expected the index to remain unchanged - at the level of 56.0 points. In addition, it was reported that the composite index, which covered the production and service sectors also fell slightly in December - up to 56.1 from 56.2 in November. Nevertheless, the index indicated a strong increase of activity in the manufacturing and services sectors combined. At the same time, another report showed that in December, the index of business activity in the U.S. service sector, calculated by the Institute for Supply Management (ISM) fell, while reaching the level of 53.0, compared with the November reading at around 53.9. According to experts, this indicator would grow to 54.6. The greatest impact on the reduction of sub- indices had orders and business activity.
Gold: The gold prices were rising fourth consecutive session, despite a sharp decline. The cost of the February gold futures rose to $ 1247.70 per ounce on the COMEX today.
Oil: The cost of the WTI oil brand traded in a range of $ 93.70 - $ 94.60 per barrel on the New York Mercantile Exchange.