The Dollar was lower against a basket of currencies for the sixth day on Tuesday as Federal Reserve Chairman Ben Bernanke gave a weak assessment of the US housing sector, adding to mounting fears of recession.
Still, the US currency staged a late session rebound versus the Japanese Yen after US stocks pared some of their sharp losses.
Also on Tuesday, comments by euro finance ministers ahead of the European Central Bank meeting on Thursday helped put a halt to the Euro's five-day run versus the dollar. However, investors are convinced that the poor US economic outlook will keep the Fed on its easing path, which adds pressure on the Dollar.
Yesterday, UsdJpy dollar was down 0.37% at 103.13, rebounding from the three-year low 102.61 reached on Monday. EurJpy was down 0.31% at 156.86 and EurChf dropped 0.13% to 1.5806, regaining from Monday 1.5701 low. UsdChf declined 0.16% to 1.0394. EurUsd was flat at 1.5207, off the 1.5276 all-time high set on Monday.
Low-yielding currencies such as the Yen and Chf tend to attract flows during periods of uncertainty as the low interest rates reflect the capital surplus of their respective countries.
Jean-Claude Juncker, chairman of the Euro group of finance ministers, expressed concern about excessive exchange rate moves, which gave the Dollar some respite after recent successive record lows. Analysts said the Euro's retreat against the Dollar was likely temporary, with the ECB likely to remain focused on inflation and US economic data most likely to disappoint.
UsdCad surged 0.5 percent to 0.9943 after the Bank of Canada cut interest rates by 50bp. RBA raise interest rate by 25bp to 7.25%.