Investing.com - The dollar regained ground against the other major currencies on Wednesday, after data showed that service sector activity in the U.S. grew at the fastest pace since August 2005 in July.
The Institute of Supply Management said its non-manufacturing purchasing manager's index rose to 60.3 last month from 56.0 in June, above forecasts for a reading of 56.2.
The data came after payroll processing firm ADP said non-farm private employment rose 185,000 last month, below expectations for an increase of 215,000. The economy created 229,000 jobs in June, whose figure was downwardly revised from a previously reported increase of 237,000.
Separately, the U.S. Bureau of Economic Analysis said that the trade deficit widened to $43.84 billion in June from $40.94 billion in May, whose figure was revised from a previously reported deficit of $40.7 billion.
Analysts had expected the U.S. trade deficit to widen to $42.8 billion in June.
Investors were now turning their attention to the upcoming U.S. jobs report for July, which could reinforce expectations for higher interest rates.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, edged up 0.15% to 98.19, the highest level since June 21.
EUR/USD slipped 0.15% to 1.0865. Earlier Wednesday, data showed that euro zone service sector growth slowed in July, as activity in France and Italy slowed.
The euro area services PMI fell to 53.9 from June’s four year high of 54.2.
Another report showed that retail sales in the region fell by a larger than forecast 0.6% in June.
The dollar remained lower against the pound, with GBP/USD up 0.37% at 1.5620.
Data earlier showed that Markit's U.K. services PMI fell to 57.4 in July from 58.5 in June, compared to expectations for a reading of 58.0.
Elsewhere, the dollar turned higher against the yen and the Swiss franc, with USD/JPY up 0.40% at 124.88 and with USD/CHF adding 0.27% at 0.9810.
The Australian and New Zealand dollars were lower, with AUD/USD down 0.31% at 0.7356 and with NZD/USD shedding 0.24% to 0.6524.
Statistics New Zealand reported on Wednesday that the number of employed people rose by 0.3% in the second quarter, disappointing expectations for a 0.5% gain, after an increase of 0.7% in the three months to March.
The report also showed that New Zealand's unemployment rate ticked up to 5.9% in the last quarter from 5.8% in the first quarter of 2015, in line with expectations.
Meanwhile, USD/CAD slid 0.29% to trade at 1.3153.
In Canada, official data on Wednesday showed that the trade deficit was C$480 million in June, compared to a deficit of C$3.37 billion in May, whose figure was revised from a previously reported deficit of C$3.34 billion.
Analysts had expected Canada to post a trade deficit of C$2.8 billion in June.