Dollar slips as Hong Kong protests halt recent rally

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The dollar's three-month rally took a breather on Monday on nervousness over Beijing's response to democracy protests in Hong Kong and concerns it might hurt the region's economy and status as a global financial hub.

The Communist government, which resumed its rule over the former British colony in 1997, made clear it would not tolerate dissent, and warned against any foreign interference.

The dollar's rally on expectations the Federal Reserve would raise interest rates in the mid-2015 was seen as overdone and the currency was headed for a pullback, analysts said.

The greenback reached six-year highs against the in Asian trading, while the dollar index hit a four-year peak before falling on worries about Hong Kong and a sell-off on Wall Street.

The dollar was up 0.06 percent at 109.33 yen, down from an earlier peak of 109.74 yen, according to Reuters data.

The dollar index slipped 0.13 percent at 85.527 after rising to 85.798 earlier.

The euro steadied against the greenback at $1.2703, up 0.2 percent from late Friday. The single currency hit a two-year low against the dollar earlier Monday at $1.2665.

The Hong Kong dollar was stable after falling to a six-month low. Pegged to the U.S. dollar, it was last down about 0.1 percent at 7.7649.

Monday's data on personal spending and pending home sales suggested U.S. economy is growing but not fast enough for the U.S. central bank to raise policy rates from its near-zero range that it adopted in December 2008 before mid-2015.

Chicago Federal Reserve President Charles Evans on Monday urged ``patience'' on increasing rates, even though he suggested the rates could rise in the not-too-distance future.

The biggest mover among developed-world currencies was the New Zealand dollar. Figures showed the country's central bank intervened heavily against its currency in August in a bid to help its exporters.

The kiwi was down 1.4 percent to its lowest against the dollar since August 2013, last traded at $0.7765.

—By Reuters