1st LD Writethru: U.S. dollar gains despite soft data

The U.S. dollar rose against other major currencies Monday as expectations for the Federal Reserve to increase interest rates later this year remained despite overall downbeat economic data from the country.

The manufacturing index, also known as the purchasing managers index (PMI), registered 52.9 percent in February, a decrease of 0. 6 percentage point from a month ago, the Institute for Supply Management reported Monday. The latest reading showed economic activity in the U.S. manufacturing sector slowed last month to its weakest pace in more than a year.

The U.S. Commerce Department said Monday that personal income increased 0.3 percent in January, missing market consensus of 0.4 percent, while personal spending, which accounts for nearly 70 percent of the U.S. economic activity, fell 0.2 percent in January.

A separate report from the department showed U.S. construction spending declined 1.1 percent in January, lower than market consensus of a 0.3 percent gain.

Analysts said the soft data indicated a slower pace of the U.S. economic recovery but investors remained positive about an interest rate hike later this year.

In late New York trading, the euro went down to 1.1188 dollars from 1.1193 dollars in the previous session, and the British pound decreased to 1.5365 dollars from 1.5434 dollars. The Australian dollar slipped to 0.7769 U.S. dollar from 0.7811 dollar.

The U.S. dollar bought 120.15 Japanese yen, higher than 119.68 yen of the previous session. The U.S. dollar edged up to 0.9596 Swiss franc from 0.9542 Swiss franc, and it increased to 1.2540 Canadian dollars from 1.2518 Canadian dollars. Endite