RTTNews - The dollar was slightly weaker versus other major currencies Tuesday morning in New York as all eyes turned to Washington, DC, where the Federal Reserve prepared to kick off its two-day policy making meeting.
Chairman Ben Bernanke and company will likely hold interest rates steady. However, traders will look for signs that the Fed may begin to end their quantitative easing measures as the first step toward raising interest rates from the current range near zero.
The dollar extended its run of choppy trading versus the euro, slumping to 1.3990 from yesterday's level near 1.3850. The pair has been unable to sustain any direction over the past few weeks, but the dollar has managed to avoid falling below a 5-month low of 1.4338, set in early June.
German consumer confidence strengthened following a period of stability, signaling positive development in July, results of the latest consumer climate survey from the market research firm GfK Group showed Tuesday.
The survey's forward-looking consumer sentiment index rose to 2.9 points for July from a revised value of 2.6 in June. Economists were looking for a reading of 2.5 for July. The index continues to stay at a comparatively low level.
The dollar held its ground versus the sterling, staying near 1.6300. Still, the buck remains within hailing distance of a 6-month low of 1.6662, set earlier this month after a springtime swoon.
Versus the yen, the dollar dropped to a 3-week low of 94.98, before bouncing back to 95.50. Tuesday, the Japanese Cabinet Office downwardly revised the leading index for April to 76.2 from 76.5. However, the index stood above 75.5 logged in March.
The dollar has made a comeback over the past week versus resource-linked currencies, particularly the loonie, which has dropped along with crude prices. The buck held near 1.1530 versus its Canadian counterpart, as the price of oil slipped toward $67.
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