Investing.com - The dollar slid lower against a basket of other major currencies on Wednesday, as investors eyed upcoming data on U.S. durable goods orders and as upbeat German business confidence data boosted optimism over the outlook for growth in the single currency bloc.
EUR/USD climbed 0.55% to 1.0987, easing off lows of 1.0901 hit earlier in the session.
The euro strengthened after the Ifo Institute said its business climate index rose to 107.9 this month, up from 106.8 in February. Economists expected a reading of 107.3.
The survey showed German firms were more upbeat about the current situation than they were last month, with the current conditions index rising to 111.3 from 112 in February, and were also more optimistic about their prospects for the next six months.
But the euro's gains were capped as after data on Tuesday showed that U.S. consumer prices rose 0.2% in February, rebounding after a 0.7% decline in January, while core inflation also ticked higher.
The uptick in underlying inflation indicated that the Federal Reserve would still have leeway to tighten monetary policy even with inflation running below target.
San Francisco Fed President John Williams said Tuesday that the bank should start raising rates earlier and added that the fall in energy prices and the stronger dollar would only have a short term impact on inflation.
The pound gained some ground, with GBP/USD up 0.27 to 1.4888.
The British Banker's Association earlier reported that the number of new U.K. mortgages approved increased to a five-month high of 37,300 last month from January’s total of 36,400. Analysts had expected the number of new mortgages approved to rise to 36,900 in February.
Elsewhere, the dollar slipped lower against the yen and the Swiss franc, with USD/JPY edging down 0.15% to 119.56 and with USD/CHF falling 0.18% to 0.9564.
The Australian dollar held steady with AUD/USD at 0.7879, while NZD/USD edged up 0.16% to 0.7666. Meanwhile, USD/CAD eased up 0.07% to trade at 1.2503.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.45% to 97.00.
Later in the day, the U.S. was to publish data on durable goods orders.