LONDON (AFP) --
The dollar extended its New Year losing-streak on Tuesday as renewed market optimism spurred demand for currencies seen as well placed to benefit from an economic recovery, analysts said.
In London morning deals, the European single currency rose to 1.4427 dollars from 1.4408 dollars in New York late on Monday.
Against the Japanese currency, the dollar fell to 91.91 yen from 92.53 yen on Monday, when positive US and Chinese manufacturing data bolstered hopes that the worst of the economic global slump is over.
This in turn encouraged investors to seek out riskier but higher yielding currencies than the US unit.
The US Institute for Supply Management said its purchasing managers index rose to 55.9 percent in December from 53.6 percent in November, a fifth consecutive expansion and well above forecasts for 54.3 percent.
Manufacturing in China meanwhile continued to expand in December with new factory orders up for the ninth month in a row, according to a survey by HSBC China.
"After the pace of global expansion in manufacturing activity cooled in November it has accelerated again in the final month of 2009, raising hopes that growth in 2010 will be much better than last year," NAB Capital analysts wrote in a note.
"This has buoyed stock markets, pushed commodity prices higher and increased the likelihood that global economic growth will continue to exceed that in the US by a comfortable margin, weighing on the greenback."
The market was turning its attention to key monthly jobs data due out in the United States on Friday that are seen as a crucial indicator of the health of the world's largest economy.
"Market players are now trying to factor in forecasts for US payrolls figures to be released later this week," said Jitsuo Tachibana, senior manager in the foreign exchange division of Sumitomo Trust Bank.
Many investors are hoping the US economy will finally stop shedding jobs in December after months of hefty losses.
The dollar had ended 2009 on an upbeat note in the wake of government data indicating that new US claims for jobless benefits fell to the lowest level since July 2008.
In London on Tuesday, the euro was changing hands at 1.4427 dollars against 1.4408 dollars late on Monday, 132.60 yen (133.33), 0.8990 pounds (0.8955) and 1.4844 Swiss francs (1.4841).
The dollar stood at 91.91 yen (92.53) and 1.0289 Swiss francs (1.0301).
The pound was at 1.6046 dollars (1.6088).
On the London Bullion Market, the price of gold increased to 1,125.60 dollars an ounce from 1,121.50 dollars on Monday.
