Investing.com - The dollar was trading close to three-month highs against the euro on Tuesday as sentiment on the single currency was hit by concerns over a controversial bailout deal for Cyprus.
During European morning trade, the dollar was hovering close to three-month highs against the euro, with EUR/USD down 0.24% to 1.2927.
The single currency weakened broadly following news that a one-time tax was to be imposed on bank deposit holders as part of a EUR10 billion bailout deal for Cyprus.
The agreement marked the first time since the onset of the euro zone debt crisis that depositors have been forced to take a haircut in return for financial aid.
The country’s defense minister said Tuesday that a vote on the bill due to take place later in the day could be delayed to allow more time for the government to work on a revised deposit tax proposal, aimed at lessening the impact on smaller depositors.
The dollar pushed higher against the yen, with USD/JPY easing up 0.16% to 95.37.
Investors were looking ahead to the outcome of the Federal Reserve’s policy meeting on Wednesday after data last week showing that U.S. inflation was contained left the way clear for the bank to continue its asset purchase program.
Elsewhere, the Bank of Japan was to come under new leadership on Wednesday, amid expectations for more aggressive easing measures at the bank’s next policy meeting in April.
The greenback was lower against the pound, with GBP/USD falling 0.17% to 1.5082, but edged higher against the Swiss franc, with USD/CHF easing up 0.12% to 0.9471.
The greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD up 0.15% to 1.0230, AUD/USD sliding 0.36% to 1.0362 and NZD/USD losing 0.31% to trade at 0.8238.
Earlier Tuesday, the minutes of the Reserve Bank of Australia’s March meeting indicated that the bank can still cut rates if needed.
"While further reductions may be required, on the information currently to hand it was appropriate to hold rates steady," the minutes said.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.13% to 82.98.
The ZEW Institute was to release its closely watched index of German economic sentiment later Tuesday, while the U.S. was to release official data on building permits and housing starts.
During European morning trade, the dollar was hovering close to three-month highs against the euro, with EUR/USD down 0.24% to 1.2927.
The single currency weakened broadly following news that a one-time tax was to be imposed on bank deposit holders as part of a EUR10 billion bailout deal for Cyprus.
The agreement marked the first time since the onset of the euro zone debt crisis that depositors have been forced to take a haircut in return for financial aid.
The country’s defense minister said Tuesday that a vote on the bill due to take place later in the day could be delayed to allow more time for the government to work on a revised deposit tax proposal, aimed at lessening the impact on smaller depositors.
The dollar pushed higher against the yen, with USD/JPY easing up 0.16% to 95.37.
Investors were looking ahead to the outcome of the Federal Reserve’s policy meeting on Wednesday after data last week showing that U.S. inflation was contained left the way clear for the bank to continue its asset purchase program.
Elsewhere, the Bank of Japan was to come under new leadership on Wednesday, amid expectations for more aggressive easing measures at the bank’s next policy meeting in April.
The greenback was lower against the pound, with GBP/USD falling 0.17% to 1.5082, but edged higher against the Swiss franc, with USD/CHF easing up 0.12% to 0.9471.
The greenback was broadly higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD up 0.15% to 1.0230, AUD/USD sliding 0.36% to 1.0362 and NZD/USD losing 0.31% to trade at 0.8238.
Earlier Tuesday, the minutes of the Reserve Bank of Australia’s March meeting indicated that the bank can still cut rates if needed.
"While further reductions may be required, on the information currently to hand it was appropriate to hold rates steady," the minutes said.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.13% to 82.98.
The ZEW Institute was to release its closely watched index of German economic sentiment later Tuesday, while the U.S. was to release official data on building permits and housing starts.