Dollar rallies on strong US growth data

The U.S. dollar rose across the board Wednesday after official data showed U.S. economic growth unexpectedly reached 4 percent in the second quarter.
The spot rate of the dollar index, which tracks the greenback's value versus a basket of major currencies, rose more than 0.2 percent to trade around 81.4. The euro/dollar rate slid below the key level of 1.3400 and hit the lowest level in nine months.
The U.S. economy grew at an annual rate of 4.0 percent in the second quarter after unexpectedly shrinking in the first three months this year, the U.S. Commerce Department said Wednesday. The first quarter real GDP was upwardly revised to shrink 2.1 percent.
The second-quarter GDP was driven by an upswing in consumer spending and private inventory investment, topping analysts' expectations of a 3-percent growth.
The Fed wrapped up a two-day policy meeting on Wednesday. It reduced the bond-buying program by another 10 billion dollars, staying on the course of ending the purchases in October. However, the Fed maintained a dovish tone by saying that it would keep interest rates low for a "considerable time" after ending purchases.
Meanwhile, private payroll processor ADP Wednesday said in a report that private sector employment created 218,000 jobs in July, which is modestly below market consensus. Investors will pay close attention to the U.S. nonfarm payroll report for July scheduled for release on Friday by the U.S. Labor Department.
In late New York trading, the euro fell to 1.3392 dollars from 1.3410 dollars of the previous session, and the British pound decreased to 1.6916 dollars from 1.6946 dollars. The Australian dollar slipped to 0.9327 dollars from 0.9385 dollars.
The dollar bought 102.87 Japanese yen, higher than 102.13 yen of the previous session. The dollar went up to 0.9092 from 0.9069 Swiss francs, and it moved up to 1.0902 Canadian dollars from 1. 0854 Canadian dollars.