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Forex - Dollar makes steady gains ahead of Federal Reserve meeting

Published 07/30/2013, 03:15 PM
Updated 07/30/2013, 03:16 PM
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Investing.com - The dollar traded steady to higher against most major currencies on Tuesday after most investors sought out safe-haven greenback positions to await the Federal Reserve's Wednesday announcement on interest rates and monetary policy.

Trading was on the quiet side, as many are eager for fresh indications as to when stimulus tools such as the Fed's monthly USD85 billion bond-buying program, which has kept the dollar weak to spur recovery, will taper and eventually end.

In U.S. trading on Tuesday, EUR/USD was up 0.02% at 1.3264.

Earlier Tuesday, the Standard & Poor's/Case-Shiller Composite 20-city house price index rose by an annualized rate of 12.2% in May from 12.1% the previous month, a little shy of expectations for an increase to 12.4%.

While the figure missed market expectations, the numbers were strong enough to boost hopes for a more robust and sustained U.S. economic recovery, which gave the greenback some support.

Elsewhere, the Conference Board research group said that its index of U.S. consumer confidence fell to 80.3 in July from 82.1 in June, whose figure was revised up from 81.4.

Analysts had expected consumer confidence to remain unchanged at 81.4 last month, which kept some expectations alive that dollar-weakening stimulus measures will stay in place.

Meanwhile in Europe, data released earlier revealed that the Gfk German consumer climate index rose beat expectations in July, rising to 7.0 from 6.8 in June.

Analysts had expected the index to rise to 6.9 this month.

A separate report showed that Germany's consumer price index rose 0.5% in July, more than the expected 0.3% uptick, after a 0.1% rise the previous month.

The data supported the euro in earlier trading.

The greenback, meanwhile, was up against the pound, with GBP/USD trading down 0.61% at 1.5246.

The dollar was up against the yen, with USD/JPY up 0.03% at 97.99, and down against the Swiss franc, with USD/CHF trading down 0.22% at 0.9292.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.42% at 1.0309, AUD/USD down 1.55% at 0.9063 and NZD/USD trading down 0.67% at 0.7980.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.16% at 81.92.

Currency markets will move on the Federal Reserve's decision on monetary policy as well as on U.S. gross domestic product data due out Wednesday.










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