* U.S. factory and services activity quicken in November
-Markit
* Euro touches weekly low on euro zone flash PMIs
* Sterling slips after PMI as election uncertainty sets in
(New throughout, updates rates and adds comments post-U.S.
market open; new byline, changes dateline from London)
By Saqib Iqbal Ahmed
NEW YORK, Nov 22 (Reuters) - The U.S. dollar rose against a
basket of currencies on Friday after data showed U.S. factory
and services activity quickened in November in a sign of the
continued resilience of the U.S. economy in the face of the
U.S.-China trade war and other headwinds.
IHS Markit said its "flash" purchasing managers index (PMI)
for manufacturing rose to 52.2 in November from a final reading
of 51.3 in October, while its preliminary services PMI increased
to 51.6 this month from 50.6 last month.
The dollar index, which compares the dollar against
six major currencies, was up 0.15% at 98.139.
Helping the dollar's strength was a survey which showed euro
zone business growth almost ground to a halt this month as
activity in the bloc's dominant services industry increased at a
much weaker pace than expected and among manufacturers it
contracted again.
The common currency fell 0.16% against the greenback.
"That combination is what is pulling the dollar a little
higher," said Vassili Serebriakov, an FX strategist at UBS in
New York.
Despite the modest rise on Friday, the dollar has remained
largely range-bound over the last few sessions. For the week,
the dollar index is up 0.15%, on pace for its smallest weekly
move since mid September.
Mixed messages on the U.S.-China trade deal this week kept
investors from taking on any large directional positions ahead
of next week's Thanksgiving holiday.
Chinese President Xi Jinping said Beijing wants to work out
a deal with Washington and has been trying to avoid a trade war
- but is not afraid to retaliate when necessary.
A senior Chinese diplomat urged the United States to
compromise in order to develop stable relations between the
countries, saying that some U.S. politicians were trying to push
the countries into confrontation.
Meanwhile, volatility in the currency market has plunged in
recent days with the Deutsche Bank FX Volatility Index
slipping to 5.86, its lowest since mid-July.
"The dollar is relatively expensive but I think the market
is really looking for signs of a stronger global growth rebound
to revive interest in some of the currencies outside of the U.S.
but the messages that we are getting are still a bit mixed, both
in terms of the PMIs and the news on trade," said Serebriakov.
The pound dived on Friday and was on pace for a weekly loss
after surveys showed British business suffered its deepest
downturn since mid-2016, with caution rising before a Dec. 12
general election. The pound was 0.56% lower at $1.2841.
(Reporting by Saqib Iqbal Ahmed
Editing by Nick Zieminski)