Dollar Rises on ISM Data, Bernanke Comment

The U.S. dollar rose against major currencies in late New York trading on Tuesday as the Institute for Supply Management said the U.S. manufacturing was expanded in February and the chairman of the Federal Reserve said inflation in the United States was modest.

The Institute for Supply Management said Tuesday that its manufacturing gauge climbed to 61.4 in February, the highest level since May 2004, showing that the manufacturing activity was significantly expanded.

Fed chairman Ben Bernanke said in a prepared speech to the Senate Banking Committee that inflation in the U.S. was " temporary" and "relatively modest," and reiterated that the Fed would continue to maintain extremely low interest rate level through bond buying plan started from last November.

Meanwhile, a survey showed that the Manufacturing PMI in Britain was unchanged at 61.5, unchanged from January's record high. A reading of more than 50 means activity grew.

The survey also suggested inflationary pressures continued to build in Britain. The pound fluctuated against the dollar during the day.

The dollar index rebounded to above 77 from 76.909 late Monday.

In late Tuesday trading, the dollar bought 81.95 yen, comparing with 81.77 late Monday, and the euro fell to 1.3770 dollars from 1. 3800.

The British pound also fell to 1.6262 dollars from 1.6267. The dollar rose from 0.9289 to 0.9303 against Swiss francs, and also rose to 0.9749 Canadian dollars from 0.9714.