Investing.com - The U.S. dollar extended gains against its global counterparts on Tuesday, as upbeat U.S. retails sales data diminished expectations for a third round of monetary easing by the Federal Reserve, ahead of the central bank’s rate statement later in the day.
During European afternoon trade, the dollar was sharply higher against the euro, with EUR/USD tumbling 0.79% to hit 1.3052.
Official data showed that U.S. retail sales rose to the highest level in five months in February, increasing by a seasonally adjusted 1.1%, in line with expectations.
Core retail sales, which exclude automobile sales, rose by 0.9% last month, above expectations for a 0.8% gain.
The data further dampened expectations for a third round of monetary stimulus by the Fed, after data on Friday showed that the U.S. economy added more jobs than forecast in February.
Meanwhile, concerns that the debt crisis in the euro zone could flare up again lingered as Spain faced calls from European leaders to make deeper budget cuts, after the country’s prime minister raised the deficit target earlier this month.
The greenback was slightly higher against the pound, with GBP/USD slipping 0.11% to hit 1.5622.
The pound remained supported after official data earlier showed that total U.K. exports to non-EU countries rose to a record high in January, adding to hopes that the economy is recovering.
The Office for National Statistics said the goods trade deficit expanded to GBP7.53 billion in January, slightly less than forecasts for GBP7.88 billion and up from GBP7.18 billion the previous month, which had been the lowest since December 2009.
The greenback rallied to a fresh 11-month high against the yen, with USD/JPY advancing 0.71% to hit 82.81 and was also sharply higher against the Swiss franc, with USD/CHF jumping 0.80% to hit 0.9237.
Earlier in the day, the Bank of Japan kept interest rates unchanged in a range of zero to 0.1%, in a widely expected decision. The central bank left the size of its asset purchase fund unchanged at JPY30 trillion, after unexpectedly boosting the program in February, weakening the yen.
In Switzerland, official data showed that producer price inflation rose more-than-expected in February, climbing 0.8%.
Elsewhere, the greenback was mixed against its Canadian, Australian and New Zealand cousins, with USD/CAD slipping 0.08% to hit 0.9916, AUD/USD shedding 0.23% to hit 1.0493 and NZD/USD up 0.17% to hit 0.8192.
Sentiment on the Australian dollar was dented earlier, after official data showed that home loan approvals fell more-than-expected in January, while a separate report showed that Australian business confidence fell to the lowest level in four months in January.
Meanwhile, the New Zealand dollar found support after official data showed that food price inflation rose more-than-expected in February, while house sales rose sharply.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, rose 0.57% to hit 80.74.
The Fed was to announce its benchmark interest rate later in the day; the announcement was to be accompanied by the central bank’s rate statement. In addition, euro zone finance ministers were set to continue talks in Brussels throughout the day.
During European afternoon trade, the dollar was sharply higher against the euro, with EUR/USD tumbling 0.79% to hit 1.3052.
Official data showed that U.S. retail sales rose to the highest level in five months in February, increasing by a seasonally adjusted 1.1%, in line with expectations.
Core retail sales, which exclude automobile sales, rose by 0.9% last month, above expectations for a 0.8% gain.
The data further dampened expectations for a third round of monetary stimulus by the Fed, after data on Friday showed that the U.S. economy added more jobs than forecast in February.
Meanwhile, concerns that the debt crisis in the euro zone could flare up again lingered as Spain faced calls from European leaders to make deeper budget cuts, after the country’s prime minister raised the deficit target earlier this month.
The greenback was slightly higher against the pound, with GBP/USD slipping 0.11% to hit 1.5622.
The pound remained supported after official data earlier showed that total U.K. exports to non-EU countries rose to a record high in January, adding to hopes that the economy is recovering.
The Office for National Statistics said the goods trade deficit expanded to GBP7.53 billion in January, slightly less than forecasts for GBP7.88 billion and up from GBP7.18 billion the previous month, which had been the lowest since December 2009.
The greenback rallied to a fresh 11-month high against the yen, with USD/JPY advancing 0.71% to hit 82.81 and was also sharply higher against the Swiss franc, with USD/CHF jumping 0.80% to hit 0.9237.
Earlier in the day, the Bank of Japan kept interest rates unchanged in a range of zero to 0.1%, in a widely expected decision. The central bank left the size of its asset purchase fund unchanged at JPY30 trillion, after unexpectedly boosting the program in February, weakening the yen.
In Switzerland, official data showed that producer price inflation rose more-than-expected in February, climbing 0.8%.
Elsewhere, the greenback was mixed against its Canadian, Australian and New Zealand cousins, with USD/CAD slipping 0.08% to hit 0.9916, AUD/USD shedding 0.23% to hit 1.0493 and NZD/USD up 0.17% to hit 0.8192.
Sentiment on the Australian dollar was dented earlier, after official data showed that home loan approvals fell more-than-expected in January, while a separate report showed that Australian business confidence fell to the lowest level in four months in January.
Meanwhile, the New Zealand dollar found support after official data showed that food price inflation rose more-than-expected in February, while house sales rose sharply.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, rose 0.57% to hit 80.74.
The Fed was to announce its benchmark interest rate later in the day; the announcement was to be accompanied by the central bank’s rate statement. In addition, euro zone finance ministers were set to continue talks in Brussels throughout the day.