Investing.com – The dollar pared gains against other major currencies on Wednesday, after a disappointing U.S. manufacturing activity report and as investors awaited the conclusion of the Federal Reserve’s policy meeting.
The Institute of Supply Management reported on Wednesday that the U.S. manufacturing sector’s growth slowed last month.
The data came after payrolls processor ADP said U.S. private employers added 235,000 jobs in October, beating economists’ expectations.
Later Wednesday, the Fed was expected to leave interest rates unchanged at the conclusion of its two-day policy meeting, but investors were waiting for any indications that it will resume raising rates next month as expected, and the timing of any rate hikes in 2018.
Separately, U.S. President Donald Trump was expected to announce his pick for the next chair of the Fed on Thursday. While there are five key candidates, Fed Governor Jerome Powell is seen as a potential winner.
The pound was boosted earlier by data showing that the UK manufacturing sector grew at a faster than expected pace in October brightened the outlook for fourth quarter growth.
Demand for sterling was also underpinned by expectations that the Bank of England will raise interest rates for the first time in almost a decade on Thursday.
Meanwhile, USD/CAD was almost unchanged at 1.2888.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.18% at 94.62 by 11:45 a.m. ET (15:45 GMT).