US dollar advances on positive service industry data

The US dollar advanced against most major currencies Tuesday, supported by better-than-expected US service industry data. U.S. non-manufacturing sector grew in October for the 46th consecutive month, said the Institute for Supply Management Tuesday. The non-manufacturing index registered 55.4 in October, higher than September's reading of 54.4 and suggesting a continuous expansion. The data increased speculations once more that the Federal Reserve may start tapering the quantitative easing earlier than expected. The Fed decided to keep its bond-buying program at current scale after a two-day policy meeting last week. Investors remained cautious amid uncertainties about whether the European Central Bank would cut the interest rate during its policy meeting scheduled for Thursday. The euro plunged against the dollar last week after official data showed euro-zone inflation fell to the lowest level in four years, while euro-zone unemployment rate rose to a record high of 12.2 percent. Investors are closely watching major economic data due out this week in a bid to gauge the Fed's future plan. The Commerce Department will release the third-quarter gross domestic product statistics of the United States Thursday, while the Labor Department will publish October's nonfarm payrolls report Friday. In late New York trading, the euro fell to 1.3474 dollars from 1.3516 dollars of the previous session, and the British pound increased to 1.6074 dollars from 1.5969 dollars. The Australian dollar declined to 0.9492 dollar from 0.9507 dollar. The dollar bought 98.59 Japanese yen, higher than 98.55 yen of the previous session. The dollar moved up to 0.9129 Swiss franc from 0.9036 Swiss franc and it went up to 1.0460 Canadian dollars from 1.0422 Canadian dollars.