Investing.com - The U.S. dollar was broadly higher against its global counterparts on Wednesday, as demand for the currency was supported after the Federal Reserve upgraded its outlook for the U.S. economy, dampening expectations for a fresh round of easing.
During European morning trade, the dollar was trading close to a one-month high against the euro, with EUR/USD sliding 0.19% to hit 1.3058.
In its rate statement on Tuesday, the Fed said it now expects to see “moderate economic growth” after its January statement said growth would be “modest” and added that higher oil prices could place upward pressure on inflation.
The central bank also acknowledged the recent improvement in the labor market, saying it expected the unemployment rate to “decline gradually.”
However, policymakers reiterated their intention to keep the benchmark interest rate unchanged at a record low through late 2014 and warned that risks to the economic recovery still remained.
The greenback was also supported after data on Tuesday showed that U.S. retail sales rose to a five-month high of 1.1% in February, coming after data last week which showed that the U.S. economy added more jobs than forecast last month.
The greenback was almost unchanged against the pound, with GBP/USD inching up 0.01% to hit 1.5706.
Earlier in the day, official data showed that the number of people claiming unemployment benefits in the U.K. rose more-than-expected in February, while the unemployment rate held steady at 8.4%, the highest level since 1995.
The greenback was close to an 11-month high against the yen, with USD/JPY adding 0.50% to hit 83.35 and was also up against the Swiss franc, with USD/CHF rising 0.38% to hit 0.9266.
The yen has remained under pressure since last month’s surprise decision by the Bank of Japan to ease monetary policy and set a targeted inflation rate, while the country’s increasing trade deficit has threatened the yen’s traditional safe haven status.
Elsewhere, the greenback was stronger against its Canadian, Australian and New Zealand cousins, with USD/CAD climbing 0.52% to hit 0.9938, AUD/USD dropping 0.72% to hit 1.0474 and NZD/USD tumbling 1.11% to hit 0.8139.
Sentiment on the Australian dollar was hit after data showed that consumer confidence slumped in March, as uncertainty over the global economic outlook weighed and as major banks raised mortgage rates, despite two successive rate cuts by the Reserve Bank of Australia late last year.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.19% to hit 80.78.
Later in the day, the U.S. was to produce official data on the country’s current account, as well as data on import prices and crude oil stockpiles. In addition, Fed Chairman Ben Bernanke was due to speak; his comments would be closely watched.
During European morning trade, the dollar was trading close to a one-month high against the euro, with EUR/USD sliding 0.19% to hit 1.3058.
In its rate statement on Tuesday, the Fed said it now expects to see “moderate economic growth” after its January statement said growth would be “modest” and added that higher oil prices could place upward pressure on inflation.
The central bank also acknowledged the recent improvement in the labor market, saying it expected the unemployment rate to “decline gradually.”
However, policymakers reiterated their intention to keep the benchmark interest rate unchanged at a record low through late 2014 and warned that risks to the economic recovery still remained.
The greenback was also supported after data on Tuesday showed that U.S. retail sales rose to a five-month high of 1.1% in February, coming after data last week which showed that the U.S. economy added more jobs than forecast last month.
The greenback was almost unchanged against the pound, with GBP/USD inching up 0.01% to hit 1.5706.
Earlier in the day, official data showed that the number of people claiming unemployment benefits in the U.K. rose more-than-expected in February, while the unemployment rate held steady at 8.4%, the highest level since 1995.
The greenback was close to an 11-month high against the yen, with USD/JPY adding 0.50% to hit 83.35 and was also up against the Swiss franc, with USD/CHF rising 0.38% to hit 0.9266.
The yen has remained under pressure since last month’s surprise decision by the Bank of Japan to ease monetary policy and set a targeted inflation rate, while the country’s increasing trade deficit has threatened the yen’s traditional safe haven status.
Elsewhere, the greenback was stronger against its Canadian, Australian and New Zealand cousins, with USD/CAD climbing 0.52% to hit 0.9938, AUD/USD dropping 0.72% to hit 1.0474 and NZD/USD tumbling 1.11% to hit 0.8139.
Sentiment on the Australian dollar was hit after data showed that consumer confidence slumped in March, as uncertainty over the global economic outlook weighed and as major banks raised mortgage rates, despite two successive rate cuts by the Reserve Bank of Australia late last year.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.19% to hit 80.78.
Later in the day, the U.S. was to produce official data on the country’s current account, as well as data on import prices and crude oil stockpiles. In addition, Fed Chairman Ben Bernanke was due to speak; his comments would be closely watched.