Dollar high on U.S. factory data and dovish BoJ comments

The USD traded higher against most major currencies on Monday following U.S. manufacturing data which was higher expectations, while dovish comments out of the BOJ weakened the Japanese Yen and boosted demand for the U.S. currency.

The USD was up against the Japanese Yen, with USD/JPY up 0.61% at 103.08, and up against the Swiss Franc, with USD/CHF increasing 0.25% at 0.9085.

The Yen was under pressure on market expectations for the Bank of Japan to increase the stimulus programs to meet its 2% inflation target by 2015.

In U.S. trading on Monday, EUR/USD was down 0.38% at 1.3540.

The ISM manufacturing purchasing managers’ index increased to 57.3 in November from 56.4 in October. Analysts were expecting the index to drop to 55.0.

According to the report, both production and new orders increased by around 3 points to 62.8 and 63.6, respectively.

In London, Markit Economics reported that the Eurozone’s manufacturing PMI increased to a two-year high of 51.6 in November from October’s 51.5 reading, high above estimates that the figure will not change.

Germany’s PMI came in at 52.7 in comparison to market forecasts of an unchanged reading of 52.5.

In Spain, manufacturing sector narrowed for the first time since July last month, while the French manufacturing sector narrowed for the 21st straight month, which resulted in investors supporting the USD over the Euro.

The USD was high against the British Pound, with GBP/USD losing 0.11% at 1.6354.

The USD was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD adding 0.16% at 1.0632, AUD/USD losing 0.10% at 0.9101 and NZD/USD adding 0.55% at 0.8179.

The dollar index was up 0.33% at 80.94.

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