Investing.com - The dollar was mixed against major world currencies on Tuesday after poor manufacturing data sparked talk of Federal Reserve intervention to prop up the economy via stimulus measures, which weakened the dollar.
Talk some European countries oppose recently approved measures to contain the debt crisis, however, fueled some demand for the greenback.
In Asian trading on Tuesday, EUR/USD was trading up 0.06% at 1.2584.
A key manufacturing figure posted its worst performance in three years, rekindling talk the Federal Reserve will intervene and stimulate the economy via quantitative easing to spur recovery.
Earlier in the U.S., the Institute for Supply Management reported that its index of manufacturing activity fell to 49.7 in June from 53.5 in May.
New orders dropped to 47.8 from 60.1, while the employment gauge fell to 56.6 from 56.9.
On the index, a reading above 50.0 indicates industry expansion, while below indicates contraction.
June's figure was the lowest reading since July 2009 and well below analyst forecasts for the index to slip down to 52.0.
Under quantitative easing, the Federal Reserve buys bonds held by banks, injecting the financial system full of liquidity in the process with the aim of stimulating investing and hiring.
As a side effect the dollar weakens.
The dollar's decline was limited, however, by the safe-haven nature of the currency.
Investors sold stocks after the weak manufacturing data was released, and stashed their capital in safe-haven dollar positions on sentiment that while Fed easing remained possible, the U.S. central bank doesn't tend to act on one disappointing indicator alone.
Meanwhile in Europe, Finland and the Netherlands criticized measures approved at a European Union summit that aim to tackle the debt crisis.
E.U. leaders voted to give the European Stability Mechanism, a bailout fund, approval to recapitalize banks as well as the green light to buy government bonds to ease credit conditions in troubled countries, the latter measure drawing criticism from Helsinki and Amsterdam, which pressured the euro lower.
Also in Europe, the eurozone unemployment rate rose to a record high 11.1% in May from 11.0% in April, which further curbed the dollar's losses.
The greenback, meanwhile, was down slightly against the pound, with GBP/USD down 0.01% and trading at 1.5691.
The U.S. currency was up against the yen, with USD/JPY trading up 0.10% at 79.59, and down against the Swiss franc, with USD/CHF trading down 0.04% at 0.9548.
The dollar was down against its cousins in Canada, Australia and New Zealand, with USD/CAD down 0.07% 1.0164, AUD/USD up 0.20% at 1.0269 and NZD/USD up 0.19% at 0.8052.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.02% at 82.00.
Official U.S. manufacturing data will release later Tuesday.
Talk some European countries oppose recently approved measures to contain the debt crisis, however, fueled some demand for the greenback.
In Asian trading on Tuesday, EUR/USD was trading up 0.06% at 1.2584.
A key manufacturing figure posted its worst performance in three years, rekindling talk the Federal Reserve will intervene and stimulate the economy via quantitative easing to spur recovery.
Earlier in the U.S., the Institute for Supply Management reported that its index of manufacturing activity fell to 49.7 in June from 53.5 in May.
New orders dropped to 47.8 from 60.1, while the employment gauge fell to 56.6 from 56.9.
On the index, a reading above 50.0 indicates industry expansion, while below indicates contraction.
June's figure was the lowest reading since July 2009 and well below analyst forecasts for the index to slip down to 52.0.
Under quantitative easing, the Federal Reserve buys bonds held by banks, injecting the financial system full of liquidity in the process with the aim of stimulating investing and hiring.
As a side effect the dollar weakens.
The dollar's decline was limited, however, by the safe-haven nature of the currency.
Investors sold stocks after the weak manufacturing data was released, and stashed their capital in safe-haven dollar positions on sentiment that while Fed easing remained possible, the U.S. central bank doesn't tend to act on one disappointing indicator alone.
Meanwhile in Europe, Finland and the Netherlands criticized measures approved at a European Union summit that aim to tackle the debt crisis.
E.U. leaders voted to give the European Stability Mechanism, a bailout fund, approval to recapitalize banks as well as the green light to buy government bonds to ease credit conditions in troubled countries, the latter measure drawing criticism from Helsinki and Amsterdam, which pressured the euro lower.
Also in Europe, the eurozone unemployment rate rose to a record high 11.1% in May from 11.0% in April, which further curbed the dollar's losses.
The greenback, meanwhile, was down slightly against the pound, with GBP/USD down 0.01% and trading at 1.5691.
The U.S. currency was up against the yen, with USD/JPY trading up 0.10% at 79.59, and down against the Swiss franc, with USD/CHF trading down 0.04% at 0.9548.
The dollar was down against its cousins in Canada, Australia and New Zealand, with USD/CAD down 0.07% 1.0164, AUD/USD up 0.20% at 1.0269 and NZD/USD up 0.19% at 0.8052.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.02% at 82.00.
Official U.S. manufacturing data will release later Tuesday.