Investing.com - The U.S. dollar reversed earlier losses against most of its major counterparts on Tuesday, as renewed concerns over the debt crisis in the euro zone and a flurry of unexpectedly weak U.S. data sparked increased safe haven demand.
During U.S. morning trade, the dollar was slightly higher against the euro, with EUR/USD shedding 0.24% to hit 1.3109.
The euro weakened broadly as the yield on Portugal’s 10-year government bonds stayed close to Monday’s euro-era highs at 16%, fuelling concerns that Lisbon may need a debt restructuring deal similar to Greece’s.
Risk appetite was also hit after a report showed that manufacturing activity in the Chicago area declined unexpectedly in January.
The Chicago purchasing managers’ index declined to a seasonally adjusted 60.2, from a reading of 62.5 in December.
Analysts had expected the PMI to rise to 63.0 in January.
A separate report showed that U.S. consumer confidence deteriorated unexpectedly in January, falling to 61.1 from a reading of 64.8 in December and confounding expectations for an increase to 68.2.
The weak data underlined concerns over the outlook for the U.S. economic recovery, after the Federal Reserve pushed back the timing of likely interest rate hike to mid-2014 last week.
The greenback pared losses against the pound, with GBP/USD up 0.31% to hit 1.5759, off an earlier high of 1.5796.
Earlier in the day, official data showed that bank lending in the U.K. remained subdued in December, rising by GBP0.4 billion, below expectations for GBP1.2 billion increase.
A separate report showed that consumer confidence in the U.K. rose to its highest level in seven months in January.
The greenback was close to a three-month low against the yen, with USD/JPY shedding 0.24% to hit 76.17.
The stronger yen prompted Japanese Finance Minister Jun Azumi to reiterated a warning that he will take "decisive steps" if speculators push the currency up too sharply.
But the greenback was higher against the Swiss franc, with USD/CHF adding 0.18% to hit 0.9185.
Elsewhere, the greenback was mixed against its Canadian, Australian and New Zealand cousins, with USD/CAD inching up 0.03% to hit 1.0017, AUD/USD gaining 0.25% to hit 1.0627 and NZD/USD advancing 0.84% to hit 0.8262.
The Canadian dollar came under pressure after official data showed that the country’s economy contracted unexpectedly in November, as a result of lower output in the energy sector.
Statistics Canada said GDP contracted by a seasonally adjusted 0.1%, confounding expectations for growth of 0.2%, after remaining flat in October.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.02% to hit 79.22.
Also Tuesday, data showed that the S&P/Case-Shiller U.S. home price index fell more-than-expected in November, declining for the 17th consecutive month.
During U.S. morning trade, the dollar was slightly higher against the euro, with EUR/USD shedding 0.24% to hit 1.3109.
The euro weakened broadly as the yield on Portugal’s 10-year government bonds stayed close to Monday’s euro-era highs at 16%, fuelling concerns that Lisbon may need a debt restructuring deal similar to Greece’s.
Risk appetite was also hit after a report showed that manufacturing activity in the Chicago area declined unexpectedly in January.
The Chicago purchasing managers’ index declined to a seasonally adjusted 60.2, from a reading of 62.5 in December.
Analysts had expected the PMI to rise to 63.0 in January.
A separate report showed that U.S. consumer confidence deteriorated unexpectedly in January, falling to 61.1 from a reading of 64.8 in December and confounding expectations for an increase to 68.2.
The weak data underlined concerns over the outlook for the U.S. economic recovery, after the Federal Reserve pushed back the timing of likely interest rate hike to mid-2014 last week.
The greenback pared losses against the pound, with GBP/USD up 0.31% to hit 1.5759, off an earlier high of 1.5796.
Earlier in the day, official data showed that bank lending in the U.K. remained subdued in December, rising by GBP0.4 billion, below expectations for GBP1.2 billion increase.
A separate report showed that consumer confidence in the U.K. rose to its highest level in seven months in January.
The greenback was close to a three-month low against the yen, with USD/JPY shedding 0.24% to hit 76.17.
The stronger yen prompted Japanese Finance Minister Jun Azumi to reiterated a warning that he will take "decisive steps" if speculators push the currency up too sharply.
But the greenback was higher against the Swiss franc, with USD/CHF adding 0.18% to hit 0.9185.
Elsewhere, the greenback was mixed against its Canadian, Australian and New Zealand cousins, with USD/CAD inching up 0.03% to hit 1.0017, AUD/USD gaining 0.25% to hit 1.0627 and NZD/USD advancing 0.84% to hit 0.8262.
The Canadian dollar came under pressure after official data showed that the country’s economy contracted unexpectedly in November, as a result of lower output in the energy sector.
Statistics Canada said GDP contracted by a seasonally adjusted 0.1%, confounding expectations for growth of 0.2%, after remaining flat in October.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.02% to hit 79.22.
Also Tuesday, data showed that the S&P/Case-Shiller U.S. home price index fell more-than-expected in November, declining for the 17th consecutive month.