Investing.com - The dollar moved higher against other major currencies on Wednesday, as the euro weakened broadly, although investors continued to eye political developments in the U.S.
EUR/USD dropped 0.55% to 1.1217 following reports the European Central Bank plans to cut inflation forecasts for the next three years.
The news added to expectations that the ECB could strike a less dovish tone at its meeting on Thursday after recent economic reports indicated that the recovery in the euro area is deepening.
The greenback was weaker earlier in the day, as investors awaited former FBI Director James Comey's testimony to a Senate committee on Thursday
Investors are fearful that the Trump administration may be further damaged by any revelations that could emerge when Comey testifies about Russia’s alleged involvement in the U.S. election.
GBP/USD was little changed at 1.2906.
While pollsters still expect British Prime Minister Theresa May to win the most seats in the Thursday election, a tight result could throw the country into political deadlock just days before formal Brexit talks with the European Union are due to begin on June 19.
USD/JPY was also steady at 109.46, while USD/CHF climbed 0.53% to trade at 0.9670.
The Australian and New Zealand dollars were stronger, with AUD/USD up 0.64% at 0.7555 and with NZD/USD adding 0.08% to 0.7191.
The Australian Bureau of Statistics earlier said gross domestic product rose 0.3% in the first quarter, beating expectations for an uptick of 0.2% and after a growth rate of 1.1% in the last quarter of 2016.
Meanwhile, USD/CAD was almost unchanged at 1.3454, the lowest since May 29.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.37% at 96.87, off Tuesday’s seven-month low of 96.47.