Investing.com - The dollar pushed lower against the other major currencies in holiday-thinned trade on Monday, as downbeat U.S. home sales data dampened demand for the greenback.
Trading volumes were thin as many investors already closed books before the end of the year, reducing liquidity in the market and increasing volatility, which helped exaggerate market moves.
During U.S. morning trade, EUR/USD gained 0.41% to 1.3801.
In a report, the National Association of Realtors said its pending home sales index increased by a seasonally adjusted 0.2% last month, disappointing expectations for a 1% gain. Pending home sales for October were revised to a 1.2% decline from a previously reported drop of 0.6%.
The euro also remained supported after European Central Bank Governing Council member Jens Weidmann on Friday said keeping interest rates low may endanger political reforms.
According to Germany’s Bild newspaper, Weidmann said low inflation shouldn’t be used to justify loose monetary policy. "We must take care to raise interest rates again in a timely manner should inflation pressures build," he reportedly added.
But the greenback's losses were expected to remain limited by expectations for further stimulus tapering by the Federal Reserve. The U.S. central bank will start reducing its bond-buying stimulus program by USD10 billion a month in January, amid indications of an improving U.S. economy.
The pound edged higher against the dollar, with GBP/USD up 0.18% to 1.6508.
Elsewhere, the greenback edged lower against the yen but was still trading near five-year highs, with USD/JPY down 0.10% to 105.07 and slid against the Swiss franc, with USD/CHF down 0.36% to 0.8883.
The yen remained pressured by speculation the Bank of Japan will have to expand its stimulus program in the coming months in order to meet its target of 2% inflation by 2015.
Minutes of the BoJ’s November policy meeting last week showed that that not all board members were convinced that the country’s growth was on a long-term upward trend. Investors also reacted to comments made by BoJ Governor Haruhiko Kuroda, who said that the nation’s economy hadn’t yet completely wiped out deflation.
The greenback was broadly lower against the Australian, New Zealand and Canadian dollars, with AUD/USD up 0.39% to 0.8903, NZD/USD rising 0.47% to 0.8192 and USD/CAD down 0.40% to 1.0666.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.40% to 80.14.
Trading volumes were thin as many investors already closed books before the end of the year, reducing liquidity in the market and increasing volatility, which helped exaggerate market moves.
During U.S. morning trade, EUR/USD gained 0.41% to 1.3801.
In a report, the National Association of Realtors said its pending home sales index increased by a seasonally adjusted 0.2% last month, disappointing expectations for a 1% gain. Pending home sales for October were revised to a 1.2% decline from a previously reported drop of 0.6%.
The euro also remained supported after European Central Bank Governing Council member Jens Weidmann on Friday said keeping interest rates low may endanger political reforms.
According to Germany’s Bild newspaper, Weidmann said low inflation shouldn’t be used to justify loose monetary policy. "We must take care to raise interest rates again in a timely manner should inflation pressures build," he reportedly added.
But the greenback's losses were expected to remain limited by expectations for further stimulus tapering by the Federal Reserve. The U.S. central bank will start reducing its bond-buying stimulus program by USD10 billion a month in January, amid indications of an improving U.S. economy.
The pound edged higher against the dollar, with GBP/USD up 0.18% to 1.6508.
Elsewhere, the greenback edged lower against the yen but was still trading near five-year highs, with USD/JPY down 0.10% to 105.07 and slid against the Swiss franc, with USD/CHF down 0.36% to 0.8883.
The yen remained pressured by speculation the Bank of Japan will have to expand its stimulus program in the coming months in order to meet its target of 2% inflation by 2015.
Minutes of the BoJ’s November policy meeting last week showed that that not all board members were convinced that the country’s growth was on a long-term upward trend. Investors also reacted to comments made by BoJ Governor Haruhiko Kuroda, who said that the nation’s economy hadn’t yet completely wiped out deflation.
The greenback was broadly lower against the Australian, New Zealand and Canadian dollars, with AUD/USD up 0.39% to 0.8903, NZD/USD rising 0.47% to 0.8192 and USD/CAD down 0.40% to 1.0666.
The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.40% to 80.14.