Investing.com - The dollar was lower against the euro and the yen on Wednesday after an auction of Italian five and 10-year government bonds met with solid investor demand, but saw borrowing costs rise sharply.
During European late morning trade, the dollar pulled back from seven-week highs against the euro, with EUR/USD rising 0.24% to 1.3093.
Italy sold the full targeted amount of EUR6.5 billion two days after Italian elections ended with no party in control of the Senate, raising the prospect of a prolonged period of political instability and potentially reigniting the crisis in the euro zone.
Sentiment on the euro remained subdued as investors awaited political developments in Italy, amid concerns over whether a government can be formed.
Investors were also looking ahead to a second day of Congressional testimony by Federal Reserve Chairman Ben Bernanke later in the trading day. Bernanke defended the bank's easing program on Tuesday, saying that the benefits outweighed the possible costs.
Elsewhere, the dollar was lower against the yen, with USD/JPY down 0.38% to 91.61.
The greenback eased against the pound, but remained close to 31-month highs, with GBP/USD edging up 0.14% to 1.5146.
In the U.K. official data confirmed that the economy contracted by 0.3% in the fourth quarter in line with initial estimates and economists’ forecasts.
The weak data reinforced concerns over the threat of a triple-dip recession, after ratings agency Moody’s downgraded the U.K.’s triple-A rating by one notch last week, citing a weak outlook for growth and a rising debt burden.
The greenback edged lower against the Swiss franc, with USD/CHF down 0.13% to 0.9306.
The greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD rising 0.10% to 1.0267, AUD/USD falling 0.42% to 1.0186 and NZD/USD sliding 0.18% to 0.8233.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.22% to 81.72.
The U.S. was to publish official data on durable goods orders and pending home sales later Wednesday, while European Central Bank President Mario Draghi was to speak an event in Germany.
During European late morning trade, the dollar pulled back from seven-week highs against the euro, with EUR/USD rising 0.24% to 1.3093.
Italy sold the full targeted amount of EUR6.5 billion two days after Italian elections ended with no party in control of the Senate, raising the prospect of a prolonged period of political instability and potentially reigniting the crisis in the euro zone.
Sentiment on the euro remained subdued as investors awaited political developments in Italy, amid concerns over whether a government can be formed.
Investors were also looking ahead to a second day of Congressional testimony by Federal Reserve Chairman Ben Bernanke later in the trading day. Bernanke defended the bank's easing program on Tuesday, saying that the benefits outweighed the possible costs.
Elsewhere, the dollar was lower against the yen, with USD/JPY down 0.38% to 91.61.
The greenback eased against the pound, but remained close to 31-month highs, with GBP/USD edging up 0.14% to 1.5146.
In the U.K. official data confirmed that the economy contracted by 0.3% in the fourth quarter in line with initial estimates and economists’ forecasts.
The weak data reinforced concerns over the threat of a triple-dip recession, after ratings agency Moody’s downgraded the U.K.’s triple-A rating by one notch last week, citing a weak outlook for growth and a rising debt burden.
The greenback edged lower against the Swiss franc, with USD/CHF down 0.13% to 0.9306.
The greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD rising 0.10% to 1.0267, AUD/USD falling 0.42% to 1.0186 and NZD/USD sliding 0.18% to 0.8233.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.22% to 81.72.
The U.S. was to publish official data on durable goods orders and pending home sales later Wednesday, while European Central Bank President Mario Draghi was to speak an event in Germany.