The dollar slid as U.S. business activity shrank for the first time in more than three years and investors bet the Federal Reserve won’t reduce its bond buying program. The Standard & Poor’s 500 Index rose to a record for a second day while industrial metals led commodities lower.
The dollar fell versus 14 of its 16 most-traded peers as business activity in the U.S. unexpectedly shrank for the first time in more than three years amid bets the Federal Reserve won’t slacken its bond buying under quantitative easing.
The pound climbed to an 11-week high versus the dollar after a report showed U.K. manufacturing shrank less than economists predicted last month, weakening the case for more central-bank stimulus that debases the currency.
The Canadian dollar rose against the majority of its 16 most-traded peers as crude oil, the country’s largest export, rose for a third day and traders bet the country would be less affected by falling metal prices.
The Canadian dollar touched the highest level against its U.S. counterpart in almost two months as the Bank of Japan’s monetary stimulus measures sent investors in search of higher-yielding currencies.
Canada’s dollar dropped the most since November, falling for a third straight week as concern Europe’s debt crisis will worsen overshadowed government data showing inflation and factory sales rose more than forecast.
Canada’s dollar rose versus the greenback after a report showed U.S. companies added almost three times as many jobs as forecast, prompting speculation the economy of Canada’s largest trading partner is gaining strength.