RTTNews - The dollar fell sharply versus other major currencies Wednesday morning in New York as Wall Street stocks were poised to push ahead at the opening bell, fueling appetite for higher-yielding currencies.

US stock futures were moving higher in reaction to positive earnings from chip maker Intel (INTC) and programmable chip maker Altera (ALTR).

The dollar dropped to a 2-week low of 1.4085 versus the euro, moving to the upper end of a monthly trading range.

Euro area annual inflation turned negative for the first time on record in June, the Eurostat confirmed Wednesday.

Final report from the statistical office showed that the consumer price index or CPI dropped 0.1% year-on-year in June after remaining flat in May. A year earlier, inflation was 4%. On a monthly basis, consumer prices rose 0.2% in June.

The dollar slipped to 1.6415 versus the sterling, hitting its lowest level since July 2. With the loss, the dollar moved further away from a monthly high of 1.5982, set a week ago.

The number of people claiming Jobseeker's Allowance benefit in the U.K. increased 23,800 to 1.56 million in June, the Office for National Statistics reported Wednesday. This was the smallest monthly rise in the claimant count since May 2008.

The dollar continued its slide versus the loonie, dropping to a 4-week low of C$1.1264. The petro-linked loonie has been bolstered by a rise in crude prices back above $60 a barrel and renewed confidence in the Canadian business sector.

Meanwhile, the buck was little changed versus the yen, holding near 93.50 for a second day. Earlier in the week, the dollar touched a 5-month low of 91.74.

Wednesday, the Bank of Japan retained its key interest rate, while at the same time extended its special funding measures for three months to facilitate corporate financing.

The Policy Board of the central bank unanimously voted to hold the uncollateralized overnight call rate at 0.1% as expected. The last change in rate was a 0.10% cut in interest rates at the bank's December 2008 meeting.

Back in the US, traders will closely watch the consumer prices report for June, which is due to be released at 8.30 a.m ET. Economists expect the headline figure to rise 0.6% after climbing by 0.1% last month.

The New York Federal Reserve's empire state manufacturing survey is slated to be released at 8:30 am ET. The headline general business conditions index for July is expected to come in at -5.

Traders will also turn their attention to Federal Reserve's industrial production report for June scheduled for release at 9.15 a.m. ET, with economists expecting a 0.6% decline in output after a 1.1% decline in May.

The minutes of the June FOMC meeting is due to be released at 2 pm ET.

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