* Dollar rally stalls on profit-taking
* Euro still under pressure as economic worries deepen
* Russian ruble gains versus the dollar
(Adds comments, updates prices, changes byline)
By Wanfeng Zhou
NEW YORK, Aug 12 (Reuters) - The U.S. dollar slipped
against the euro on Tuesday, breaking a five-session rally as
investors locked in profits ahead of key economic data later in
the week.
The dollar has rallied more than 4 percent against the euro
this month with help from a sell-off in oil prices and growing
fears economies elsewhere may slow at a faster pace than in the
United States.
The euro slid to a six-month low against the dollar earlier
after breaking a series of key chart levels, convincing some
analysts that the greenback may be ending its seven-year
slide.
Still, demand for the U.S. currency waned on Tuesday and
investors shrugged off data showing the U.S. trade deficit
unexpectedly shrank in June. The dollar also accelerated its
losses against the yen in late afternoon trading after selling
on Wall Street picked up speed.
"The dollar has been moving in one direction higher for the
last week or so," said Ronald Simpson, managing director of
global currency analysis at Action Economics, in Tampa,
Florida. "The market is just taking some dollars off the table
here."
"Going forward, the direction will be determined by some of
the U.S. data coming out later in the week, and also to a
degree by what happens with commodity prices," Simpson added.
Oil prices fluctuated on Tuesday, but last traded down 1.3
percent at $113.17 per barrel <Clc1>, after dropping more than
$30 since a record high hit in July. Fears of rising oil prices
had been weighing on the outlook for the U.S. economy.
In late trading in New York, the single European currency
edged up 0.1 percent to trade at $1.4923 <EUR=>, after earlier
touching a six-month low of $1.4814, according to Reuters
data.
The Russian ruble was one of the biggest gainers versus the
dollar on Tuesday, coming as Russia ordered a halt to military
operations in Georgia. For details, see []
The ruble was last 0.8 percent higher at 24.2494 to the
dollar <RUB=>, posting its best one-day gain since May.
The dollar index <.DXY>, which measures the greenback
against a basket of six currencies, fell 0.1 percent to 76.133
after hitting a six-month high earlier in the session. The
index had surged more than 4 percent this month.
The dollar was 0.7 percent lower at 109.33 yen <JPY=>, a
day after hitting a seven-month peak of 110.40 hit on the EBS
trading platform. The euro fell against the Japanese yen to
trade 0.5 percent lower at 163.16 <EURJPY=>.
DOLLAR RISKS
Losses in the greenback were limited as investors awaited
data on U.S. retail sales and consumer prices for July, due out
Wednesday and Thursday.
The U.S. economy is still ailing, with the financial sector
reeling from a year-old credit crisis, but analysts say the
outlook elsewhere in the world has buoyed the dollar's
position.
"The fact that the market could not trade above $1.50 again
is probably a good sign if you're a dollar bull," Simpson said.
"For the time being, unless we get some really shocking
economic numbers, the risk going forward is that the dollar
continues to test higher."
The euro area and Britain have buckled under the twin
strains of higher inflation and fading growth. European Central
Bank President Jean-Claude Trichet said last week the euro zone
economy was slowing more than policy-makers had expected.
Sterling fell to a 1-1/2 year low versus the dollar below
$1.90 <GBP=>, down 0.7 percent from late on Monday.
The dollar selling came despite data on Tuesday showing the
U.S. trade deficit shrank unexpectedly in June to $56.8
billion, down from a revised $59.2 billion in May. For more
details, see []..
The report was "better than expected," said Dustin Reid,
senior currency strategist at ABN Amro in Chicago. "But there
might be some people just trying to get out of recently
established long dollar positions on the back of
stronger-than-expected data."
(Additional reporting by Vivianne Rodrigues; Editing by Leslie
Adler)
