The single currency softened initially versus the dollar on Tuesday after rally in the previous session as results of a Greek Treasury bill auction indicated the country had to offer a high premium to raise capital from the market but the pair rebounded later.

After trading narrowly in Asia and European morning, euro rose to an intra-day high of 1.3628 before falling below Monday's low of 1.3555 to 1.3545 as euro was pressured by the results of Greek T-bill auction. The yield for 52-week Greek T-bills and for 26-week paper came in at 4.85% and 4.55% respectively versus 2.2% and 1.38% in the January auction. This showed Greece had to pay more than double than those paid at auctions in January of bills with similar maturities in order to to raise capital to fund its budget deficit. However, the single currency rebounded from 1.3545 in NY afternoon due to broad-based weakness in the dollar.

Versus the Japanese yen, the dollar went through a turbulent day as the pair tumbled to 92.57 in Asian afternoon before swiftly rebounding from there and rallying to an intra-day high of 93.42 in European morning after Reuters reported that Japan ruling party's draft suggested efforts should be made to maintain currency levels of around 120 yen per dollar . The pair later reversed again to 92.62 in NY morning before rising sharply to 93.35. In other news, U.S. trade deficit widened to 39.7 billion in February versus the expectation of 38.5 billion with revised 36.95 billion in January. Besides, Fed's mid-March meeting minute showed that officials discussed raising for a second time the interest rate charged on emergency loans to banks but the panel decided to keep the rate unchanged.

Economic data to be released on Wednesday include: New Zealand Retail sales, Australia W'pac consumer confidence, EU Industrial production, U.S. CPI data, Retail sales.