The Dollar scaled a one-month peak against a basket of currencies on Wednesday as reports showing robust job growth and productivity gains suggested a milder slowdown in the US economy than many had thought.

The surprise jump in the ADP employer services report on private sector employment fanned expectations of an above forecast non-farm payrolls report on Friday, prompting the market to trim back chances of a 0.50% interest rate cut by the Federal Reserve next week.

Rate futures indicate traders see a 38% chance of a 50 basis point cut, down from 54% just before the ADP data. A 25 basis point cut in the fed funds rate to 4.25% has been fully priced in.

The US private sector added 189,000 private-sector jobs last month, the ADP report showed, helping to ease some market fears about trouble in global credit markets that had weighed on the greenback in recent sessions. Data on Friday will likely show that US employers, outside the farming sector, added 75,000 jobs last month.

Demand for the US currency started to rise earlier in the session as a rebound in global equity markets prompted investors to buy back Dollars after two days of declines. EurUsd was 1.14% lower at 1.4595. UsdJpy rose to a session peak of 110.96 as short-term players took profits on the Yen's rise from the previous two days. It was last trading at 110.92, up 0.97%. Sterling fell to a 4-1/2-year low against the Euro as investors bet on an interest rate cut on Thursday after service sector and house price data came in below forecasts.

EurGbp was up 0.39% at 0.72 after hitting 0.7240 intraday high. Expectations the Bank of England will lower it's main lending rate to 5.5% were also raised after the Bank of Canada surprised the market with a rate cut on Tuesday.

GbpUsd fell 1.53% to 2.0269. AudUsd fell after the Reserve Bank of Australia kept interest rates at 6.75%, as expected, but said global growth could ease in 2008. It was trading down 0.14% at 0.8710.