NEW YORK (MarketWatch) -- The U.S. dollar gained against most of its rivals Wednesday, but remained within recent trading ranges, as investors digested gloomy economic data from the United States and Europe.
"The gyrations in foreign exchange markets today reflect ongoing repatriation amidst elevated risk aversion as incoming data continue to confirm deceleration in the U.S. and global economies," wrote Michael Woolfolk, senior currency strategist at the Bank of New York Mellon, in a note to clients.
The European single currency and the British pound lost ground against the greenback, pressured by expectations for big rate cuts by the European Central Bank and the Bank of England. See full story.
The dollar index , which tracks the performance of the dollar against a trade-weighted basket of six major currencies, was at 86.811, up from 86.555 in late North American trading Tuesday.
More bleak news about the U.S. economy surfaced Wednesday.
Non-manufacturing companies in the United States contracted in November at the fastest pace on record, according to a survey of companies released Wednesday by the Institute for Supply Management.
The ISM nonmanufacturing index fell to 37.3% from 44.4% in October. It's the lowest level since the survey began in 1997. Read more.
In other economic news, the U.S. private sector shed 250,000 jobs in November, the biggest job loss in seven years, according to the ADP national employment index released Wednesday. The loss was in line with estimates of analysts surveyed by MarketWatch.
The report comes two days before the government releases its report on the labor market for November, with analysts expecting nonfarm payrolls to decline 350,000, the worst losses in more than 25 years. See Economic Report.
On Wall Street, U.S. stocks seesawed in and out of positive territory before extending gains in the last hour of trading, pulled higher by consumer discretionary and financial shares. See Market Snapshot.
Awaiting rate decisions
The euro was buying $1.2700, down from $1.2710 late Tuesday. The British pound fell to $1.4768 from $1.4916 Tuesday.
The dollar gained against the Japanese currency to 93.38 yen, compared with 93.14 yen late Tuesday.
Wednesday's data reinforced expectations for interest rate cuts from the ECB and BOE.
Purchasing managers indexes for the 15-nation euro zone and Great Britain indicated a sharp decline in activity in the services sectors, underlining expectations the central banks will take aggressive action. See full story.
The final Markit euro-zone services PMI fell to 42.5, slipping from a preliminary estimate of 43.3 and down from 45.8 in October. The November reading is the lowest since the survey began more than a decade ago. A reading of less than 50 signals a decline in activity, while a figure of more than 50 signals expansion.
Separately, data from the statistical agency Eurostat showed a steeper-than-expected 0.8% monthly decline in October euro-zone retail sales volume, for an annual fall of 2.1%.
