* Dollar resilient after upbeat U.S. spending and sentiment
* Rise in US notes yield support dollar
* Thin year-end conditions keeping moves slight
* Most global financial markets shut on Wednesday for
By Simon Falush
LONDON, Dec 24 The dollar gained slightly versus
the euro on Tuesday as U.S. consumption data fostered hopes of a
solid recovery in the world's largest economy and reinforced
convictions the Federal Reserve will continue to tighten
Consumer spending rose in November at the fastest pace since
June, while a survey showed consumer sentiment hit a five-month
high heading into the end of the year.
The data helped to push medium-term U.S. notes yields to
three-month highs, investors suspecting that the Fed could raise
interest rates sooner than it signalled last week.
"The U.S. data was robust enough to keep the dollar
supported to year end, and to convince investors that the
Federal Reserve will continue to taper," said Michael Sneyd, FX
strategist at BNP Paribas.
He was referring to the Federal Reserve's scaling back its
monthly asset purchases in its quantitative easing programme.
The euro was down 0.1 percent at $1.3682 by 1211 GMT.
Against the yen, the common currency stood at 142.65,
not far from a five-year high of 142.90 set last week.
The dollar gained 0.2 percent to 104.27 yen, not far
off a five-year high of 104.64 touched on Friday. The dollar
index gained slightly to 80.500 , edging closer to
a two-week high of 80.827 hit last week.
The data on Monday provided some optimism the U.S. economy
is firmly on the recovery path with inflation benign.
Although the Fed has gone to a great length to tell markets
that tapering of its bond buying does not automatically lead to
rate hikes, that has not stopped investors from speculating on
the Fed's eventual exit from zero interest rates.
Markets are also now looking to see if the U.S. economy will
be strong enough to allow the Fed to continue withdrawing
support through 2014.
Still, in the very near-term, the market is likely to
struggle to find fresh stimulus ahead of year-end holidays.
Most financial markets across the globe will be shut on
Wednesday for Christmas and many will stay closed on Thursday.
Worries about a cash crunch in China appeared to have taken
a back seat after the central bank last week injected 300
billion yuan ($49.41 billion) into the money market.
Traders, however, will no doubt be keeping a close eye on
any fresh developments there in the year-end lull.