* Dollar index down 0.1 pct; risk sentiment intact
* Stg hits 9-mo high after strong services PMI, output data
* Canada dollar tumbles further after finmin warning
* Eyes on U.S. ADB jobs report
(Recasts, adds details, updates prices)
By Tamawa Desai
LONDON, Aug 5 (Reuters) - The dollar was pressured on
Wednesday after hitting a 10-month low earlier in the week as
risk sentiment remained intact, though many investors took to
the sidelines ahead of key events later in the week.
The dollar had fallen sharply against a number of currencies
this week as risk-taking was heightened after brighter
manufacturing activity data and rises in U.S. equities, with
many players expecting more risk to the dollar's downside.
Sterling rose to a nine-month high against the dollar after
data showed strong UK services sector and industrial production
data. That came after data on Monday showed manufacturing
activity posted growth for the first time since March 2008.
"With the manufacturing index also having moved above 50
earlier this week, at face value these indicators point to
positive UK GDP growth in Q3," said Adam Cole, global head of FX
strategy at RBC Capital Markets.
But the euro was little changed against the dollar, showing
muted reaction to purchasing managers' indices for euro zone
services sectors, which generally showed improvement in July.
[]. Traders also brushed off a bigger-than-expected
fall in retail sales in the region in June.
By 1137 GMT, the euro <EUR=> was up slightly on the day at
$1.4421, near $1.4445 hit on Monday, its highest since December.
The dollar index <.DXY> was down 0.1 percent at 77.631, not
far from 77.451 hit on Monday, its lowest since September.
Sterling rose to $1.7029 <GBP=D4>, its highest since
mid-October.
The New Zealand dollar also rose to $0.6754 <NZD=D4>, its
highest since early October.
But many players were dearth to actively trade ahead of
policy decisions by the Bank of England and European Central
Bank due on Thursday, and U.S. nonfarm payrolls on Friday.
A Reuters poll last week showed economists are split whether
the BoE will extend its quantitative easing programme, although
recent brighter UK economic data are seen reducing such chances.
But analysts said it could still not be completely ruled out.
"It would be a brave investor that held on to an
aggressively long sterling position into the BoE meeting with
that risk looming," Daragh Maher, deputy head of FX strategy at
Calyon, said in a note.
Traders will also keep an eye on the ADP employment report
which is expected to show 345,000 jobs were lost in the month,
versus a loss of 473,000 in June.
Also due later in the day is the U.S. ISM non-manufacturing
survey for July.
Meanwhile, the Canadian dollar extended losses against the
U.S. dollar in the wake of comments by Canadian Finance Minister
Jim Flaherty, who said on Tuesday steps could be taken to dampen
the Canadian dollar's rise.
The Canadian dollar <CAD=D4> fell to C$1.0785 on Wednesday,
after hitting a 10-month high of $1.0632 on Tuesday prior to
Flaherty's comments.
The dollar was flat at 95.30 yen <JPY=>, showing little
reaction to China's central bank saying it would keep a close
eye on currency moves and make the yuan more flexible.
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