A brief return to risk appetite enabled the euro to post gains against the US dollar

The single currency gained half a cent on the dollar in trading yesterday as positive US data weakened demand for the haven currency.

• In early trading, a report showing China's manufacturing accelerated at its fastest pace in 18 months in October weighed heavily on the dollar as the positive news encouraged investor to buy into higher-risk currencies.
  
• The greenback lost further ground after the Institute for Supply Management's index of business activity rose much more than anticipated in October.
  
• US Manufacturing ISM rose to 55.7 in October, from 52.6 in September, well above the 53.3 reading expected by market analysts. Furthermore, pending home sales increased at a 6.1% pace in October
  
• This data, along with reports showing rising construction spending, helped stocks extend gains as investors increased their risk tolerance, detracting from the dollar's safe-haven appeal.
  
• The pair are trading steadily in this morning’s session, holding around the overnight closing price of 1.4765 as investors caution against taking positions ahead of central bank meetings in the US and EU.