Investing.com - The Australian dollar fell slightly in Asia on Tuesday in a light regional data day.
AUD/USD traded at 0.7187, down 0.04%, while USD/JPY changed hands at 119.42, down 0.03%, after Japan reported the monetary base at 29.5% year-on-year, down from 32.5% previously.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was flat at 98.95.
Overnight, the dollar edged slightly higher against the other major currencies on Monday, even after data showed that U.S. manufacturing activity contracted at the fastest pace since July 2009 in December.
The Institute for Supply Management said its index of purchasing managers fell to 48.2 last month from a reading of 48.6 in November. Analysts had expected the manufacturing PMI to inch up to 49.0 in December.
Sentiment for the safe-haven yen remained supported after data earlier showed that China’s Caixin manufacturing PMI fell to 48.2 this month from 48.6 in December, confounding expectations for a rise to 48.9.
It was the lowest reading since September and was well below the 50-point level which separates expansion from contraction. Markets were also jittery amid concerns over growing tensions in the Middle East after Saudi Arabia cut diplomatic ties with Iran over the weekend.
The move followed a weekend storming of the Saudi embassy in Tehran in response to the kingdom's execution of a prominent Shiite cleric.