Dollar holds gains, while the euro ignores low PMI (Reuters) (23-05-2008)

LONDON, May 23 (Reuters) - On Friday, the dollar was holding on to the gains it made, after oil prices pulled back from a record high, while weaker euro zone services sector data did not seem able to affect the opinion that the region's economy remains firm.

The dollar was supported on profit taking after it has fallen broadly in the past few weeks, but the U.S. currency lingered near a one-month low against a host of currencies including the euro on lingering worries about the U.S. economy.

The euro was resilient to a bigger-than-expected fall in euro zone service sector PMI, which matched a 4 1/2-year low hit in January, as it did little to change the view that the region's economy remains stronger than that of the U.S.

The euro traded at $1.5715 at 0812 GMT, barely changed on the day, but off a one-month high of $1.5814 touched on Thursday.

Still, the euro held its ground, partly because recent solid data from the euro zone's largest economy, Germany, nurtured speculation that the European Central Bank was more likely to raise rates than cut after keeping them at 4 percent this week.

  SourceReuters