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MORNING BELL: Dollar knocked after poor US data

The U.S. dollar nursed broad losses early on Wednesday, having retreated from a multi-month peak as bulls got cold feet after U.S. manufacturing contracted in November for the first time in three years. Prompting investors to trim bullish USD positions was the closely watched ISM survey, whose National Factory Index fell to 48.6 as the sector buckled under the weight of a strong dollar and deep spending cuts by energy firms. Against the yen, the greenback stepped back to 122.87 yen from Monday's high of 123.34.

The embattled euro popped above $1.0600, rebounding from a 7.5-month trough of $1.0557. It was last at $1.0635, but further upside may be limited ahead of the European Central Bank's policy review on Thursday, where markets are expecting fresh stimulus measures.

Sterling was weaker on Tuesday, shedding nearly 0.4% against the euro, hurt by a slightly weaker-than-expected survey of the British manufacturing sector. Sterling, up almost 0.4% at $1.5101 before the data, fell back to as low as $1.5070 in afternoon, flat on the day. The pound was down 0.4% against the euro at 70.22 pence per euro, with the single currency helped by better-than-expected euro zone manufacturing data.

Gold ticked up for a third session on Wednesday, buoyed by short covering following a dip in the dollar and soft U.S. manufacturing data. Spot gold edged up 0.1 percent to $1,070.60 an ounce by 0036 GMT, after gaining about 1% in the past two sessions.




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