Investing.com - The dollar pared losses against the other major currencies on Wednesday, after the release of upbeat U.S. housing sector data but investors still remained cautious ahead of the Federal Reserve’s policy statement due later in the day.
USD/JPY was up 0.09% at 118.52.
The U.S. Commerce Department said new home sales rose by 10.8% to 544,000 units last month, compared to expectations for a gain of 2.0% to 500,000.
New home sales in November were revised up to 491,000 units from a previously reported 490,000 units.
The Fed is expected to keep interest rate on hold at the conclusion of its two-day policy meeting later Wednesday after raising interest rates for the first time in almost a decade in December.
Investors were looking to the Fed policy statement for any indication that the bank is considering slowing the path of interest rate increases this year after recent global financial market turmoil.
Market participants were also cautious ahead of the conclusion of the Bank of Japan’s meeting on Friday.
Most analysts are expecting no changes to monetary policy, but recent weakness in economic reports, as well as comments by central bank officials have fueled expectations for more easing this year.
EUR/USD held steady at 1.0871.
Elsewhere, the dollar moved higher against the pound and the Swiss franc, with GBP/USD down 0.75% at 1.4244 and was steady against the Swiss franc, with USD/CHF at 1.0176.
The commodity-related Canadian dollar found some support after oil prices rose above $32 a barrel on Tuesday and was hovering around $30 a barrel on Wednesday. USD/CAD down 0.13% at 1.4098.
The Australian dollar was stronger, with AUD/USD up 0.54% at 0.7044, while NZD/USD held steady at 0.6503.
Earlier Wednesday, the Australian Bureau of Statistics said the consumer price index rose 0.4% in the fourth quarter, beating expectations for an uptick of 0.3%, after a 0.5% increase in the three months to September.
Year-on-year, consumer prices rose 1.7% in the last quarter, exceeding expectations for a 1.6% gain.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady at 99.11.