LONDON (SHARECAST) - The dollar lost ground against the euro, the yen and the pound Wednesday after disappointing private US payrolls data sparked concern about the US economic recovery.
The Institute for Supply Management said the US non-manufacturing sector expanded less than expected last month. The report fell 4.5 points to an eight-month low of 52.8 in April. Economists were predicting a rise to 58.
In a separate report Automated Data Processing said that private-sector payrolls increased by just 179,000 last month, the lowest monthly increase in five months, missing expectations of 200,000 job creations.
The yen and the Swiss franc were the currencies of choice as traders moved away from riskier currencies ahead of the European Central Bank's rate meeting Thursday and widely watched US non-farm payroll jobs at the end of the week.
The dollar fell to a low of 80.44 yen while the euro rose to $1.4829 from $1.4826 the previous session following reports that Portugal has negotiated an international bailout worth €78bn.
Meanwhile the dollar index, which measures the US currency against a basket of six others, fell to 73.121 from 73.141.
Sterling rose to $1.6489 ahead of the Bank of England meeting Thursday. Both the ECB and BoE are expected to leave its policy rate unchanged.
