The U.S. dollar showed mixed performance against its major rivals in the European session on Wednesday, after a data showed that the nation's private sector employment increased slightly more than expected in the month of November. Data from payroll processor ADP showed that private sector employment shot up by 534,000 jobs in November after surging by a revised 570,000 jobs in October.
Economists had expected private sector employment to jump by about 525,000 jobs compared to the addition of 571,000 jobs originally reported for the previous month.
In his testimony before the Senate Banking Committee on Tuesday, Powell said that it is appropriate to discuss an acceleration in the pace of tapering of asset purchases at the December meeting in the wake of strong inflationary pressures.
Powell said that the economy is very strong and inflationary pressures are higher, adding that the Fed could complete the tapering process perhaps a few months sooner.
Powell's comments raised hopes of a faster pace of tightening by the Fed despite concerns over the Omicron variant of the coronavirus.
Powell and Treasury Secretary Janet Yellen will appear before the House Financial Services Committee at 10 am ET.
The greenback showed mixed performance against its major peers in the Asian session. While it fell against the pound and the franc, it was steady against the euro. Versus the yen, it rose.
The greenback rose to 0.9218 against the franc, from a low of 0.9173 seen at 3 am ET. At yesterday's trading close, the pair was quoted at 0.9183. The greenback is seen finding resistance around the 0.94 mark.
The greenback pulled back to 113.21 against the yen, after rising to 113.63 at 1:30 am ET. The greenback may challenge support around the 122.00 mark.
The latest survey from Jibun Bank showed that Japan manufacturing sector continued to expand in November, and at a faster pace, with a seasonally adjusted manufacturing PMI score of 54.5.
That's up from 53.2 in October and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.
The greenback held steady against the euro, after a rise to 1.1303 at 3:45 am ET. The pair was worth 1.1337 when it closed deals on Tuesday.
Final survey results from IHS Markit showed that the euro area manufacturing sector growth nearly stabilized in November, following a four-month slowdown from June's record expansion.
The factory Purchasing Managers' Index rose slightly to 58.4 in November from 58.3 in the previous month. The flash reading was 58.6. A reading above 50.0 indicates expansion.
The greenback was trading at 1.3328 against the pound, down from a high of 1.3276 set at 4 am ET. The pound-greenback pair had ended yesterday's trading session at 1.3296. On the downside, 1.35 is possibly seen as the next support level for the greenback.
Final survey results from IHS Markit showed that the UK manufacturing sector grew at a faster pace in November despite stretched supply chains disrupting production schedule.
The Chartered Institute of Procurement & Supply manufacturing Purchasing Managers' Index rose to a three-month high of 58.1 in November from 57.8 in October. The flash reading was 58.2.
U.S. ISM manufacturing PMI for November and construction spending for October are set for release in the New York session.
Federal Reserve Chair Jerome Powell will testify on the CARES Act, along with Treasury Secretary Janet Yellen before the House Financial Services Committee in Washington DC at 10:00 am ET.