Dollar climbs higher on poor eurozone data

NEW YORK: The dollar pushed higher against the euro Thursday, extending its rally after a leading eurozone growth indicator showed that private business activity hit a two-month low in February.

The yen also gained in what DailyFX analyst David Song called a likely "shallow correction" after slipping lower earlier this week.

At 2200 GMT the euro was at $1.3188, down from $1.3283 late Wednesday. The euro has lost nearly two and a half cents in two days, and is more than five cents down since the beginning of February.

The dollar has gained sharply since Wednesday, when minutes from a Federal Reserve meeting in January showed increasing sentiment for curtailing the US central bank's quantitative easing stimulus -- a move that could push up interest rates.

On Thursday meanwhile the Markit institute's eurozone Purchasing Managers' Index for February fell to 47.3 from 48.6 the previous month, a sign that the eurozone economy remains weak.

"A steepening rate of decline in February is a disappointment, and suggests that the eurozone is on course to contract for a fourth consecutive quarter in the first three months of the year," said Markit chief economist Chris Williamson.

"The fall in the composite eurozone PMI in February puts a dent in hopes that the region would emerge from recession in the first quarter," added Ben May of Capital Economics.

The yen pushed to 93.11 yen to the dollar, compared 93.61 late Wednesday. The euro slipped to 122.81 yen from 124.37 yen.

The British pound rose slightly, to $1.5250 from $1.5231, but remained weak amid the prospect of more cash stimulus from the Bank of England.

The dollar rose to 0.9308 Swiss francs from 0.9272 francs.