1st LD Writethru: U.S. dollar rises on rate hike expectation

The U.S. dollar surged against most major currencies on Tuesday as the country's upbeat nonfarm payrolls raised market expectation that the Federal Reserve may raise interest rates in mid-year.

The U.S. central bank has kept rates near zero for nearly seven years to boost the waning economy. Friday's nonfarm payroll report came better than expected and showed a sound recovery of the labor market. Richard Fisher, president of the Dallas Federal Reserve Bank, said on Monday that the Fed should start to raise rates before the economy reaches full employment to avoid causing a recession..

The dollar index, which measures the greenback against six major currencies, was up 0.32 percent at 94.559 in late trading, the highest level since September 2003.

Meanwhile, the euro slumped to a 12-year low against the U.S. dollar amid the newly-started quantitative easing program by the European Central Bank and the rising concerns on Greek debt issues.

In late New York trading, the euro decreased to 1.0699 dollars from 1.0858 dollars in the previous session, and the British pound went down to 1.5073 U.S. dollars from 1.5131 dollars. The Australian dollar edged down to 0.7617 dollar from 0.7713 dollar.

The U.S. dollar bought 121.10 Japanese yen, lower than 121.18 yen of the previous session. The U.S. dollar went up to 0.9988 Swiss francs from 0.9849 Swiss francs, and it rose to 1.2672 Canadian dollars from 1.2591 Canadian dollars. Enditem