Investing.com - The dollar turned broadly lower against the other major currencies on Wednesday, after data showed that the U.S. economy grew less than expected in the first quarter, dampening optimism over the strength of the economy.
The euro rose against the dollar, with EUR/USD up 0.35% to 1.3860.
In a report, the Bureau of Economic Analysis said U.S. gross domestic product grew at an annual rate of 0.1% in the first quarter, missing expectations for growth of 1.2%. The U.S. economy expanded by 2.6% in the previous quarter.
Separately, payroll processing firm ADP said non-farm private employment rose by 220,000 this month, above expectations for an increase of 210,000.
March’s figure was revised up to a gain of 209,000 from a previously reported increase of 191,000.
In the euro zone, data showed that the annual rate of inflation ticked up to 0.7% in April, after falling to a record low 0.5% in March. Market expectations had been for an increase to 0.8%. The European Central Bank targets an inflation rate of close to but just under 2%.
Core inflation, which excludes volatile food and energy costs rose 1% in April, accelerating from 0.7% in March and in line with expectations.
The uptick in inflation eased pressure on the ECB to take steps to tackle low inflation in the euro zone. Earlier this month the central bank warned that it could launch a "broad-based" asset purchase program if the medium-term inflation outlook deteriorated.
Meanwhile, USD/JPY slid 0.30% to 102.33.
At the conclusion of its two-day policy meeting earlier, the Bank of Japan stuck to its pledge to target an annual increase in the monetary base of between ¥60 trillion and ¥70 trillion, as expected.
Sterling was higher against the dollar, with GBP/USD adding 0.12% to 1.6846. USD/CHF was down 0.38% at 0.8800.
Elsewhere, the Australian and New Zealand dollars were higher, with AUD/USD up 0.16% to 0.9283 and NZD/USD rising 0.31% to 0.8578, while USD/CAD edged up 0.09% to 1.0954.
In Canada, official data showed that the economy grew by 0.2% in February, in line with expectations, after a growth of 0.5% the previous month.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.33% at 79.62.
Market participants were looking ahead to the Federal Reserve’s monetary policy statement later Wednesday. The U.S. central bank was expected to stick to its current timetable for tapering its asset purchase program.