DOLLAR RISES AFTER MANUFACTURING REPORT

The dollar ticked higher Monday after an upbeat report on the U.S. manufacturing sector. The WSJ Dollar Index, which measures the U.S. currency against 16 others, was up 0.1% to 88.65. The dollar rose against the Japanese yen but remained weaker against many emerging-market currencies. The dollar has rallied in recent weeks as investors have grown more optimistic that the Federal Reserve will raise interest rates this year. Higher rates tend to boost the dollar by making the currency more attractive to yield-seeking investors. The dollar was boosted Monday by a report signaling that growth in the U.S. manufacturing sector rebounded in October. IHS Markit's manufacturing index climbed to 53.2 in October from 51.5 in September as new order growth hit a one-year high. Investors are also watching speeches Monday from several central bank officials including Fed governor Jerome Powell for new clues on the prospect of higher U.S. rates. Fed-funds futures, a popular tool for betting on central-bank policy, show that investors assign a 74% likelihood of a rate increase in December, according to CME Group data. That's up from about 60% at the start of the month. Emerging-market currencies, seen as vulnerable to higher U.S. borrowing costs, reclaimed some ground against the dollar. The dollar fell 0.1% against the Mexican peso, 0.9% against the Brazilian real and 0.2% against the Turkish lira. The Chinese central bank fixed the yuan 0.2% weaker against the U.S. dollar. The yuan has been trading at six-year lows against the dollar in recent sessions, reviving fears about devaluation and capital outflows from the country. Brad Bechtel, a currency strategist at Jefferies Group, says the concerns seem "a little overdone." Mr. Bechtel wrote in a note to clients that the yuan has been relatively stable against other trading partners and "some devaluation against its largest trading partner does indeed help it economically." --Ese Erheriene contributed to this article. Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com (END) Dow Jones Newswires October 24, 2016 10:43 ET (14:43 GMT)