Forexpros – The U.S. dollar was mixed against its major counterparts on Tuesday, as investors remained cautious ahead of highly anticipated policy meetings by the Federal Reserve and the European Central Bank later in the week.
During European morning trade, the dollar was steady against the euro, with EUR/USD inching up 0.06% to 1.2268.
The single currency remained supported ahead of the EBC’s policy meeting on Thursday, after central bank President Mario Draghi pledged last week to do whatever was necessary to prevent the euro zone from collapsing.
Draghi’s remarks fueled expectations that the ECB may soon reactivate its bond-buying program to help cut Spanish and Italian borrowing costs. Investors remained cautious however, amid concerns that the bank could disappoint market expectations.
Also Tuesday, official data showed that German retail sales fell unexpectedly by 0.1% in June, after a 0.3% decline the previous month, while a separate report showed that French consumer spending rose 0.1% in June, disappointing expectations for a 0.2% increase.
Germany’s unemployment rate remained unchanged at 6.8% in June, in line with expectations.
The greenback was higher against the pound, with GBP/USD falling 0.13% to 1.5690.
A report by Gfk research group showed that its index of consumer confidence for the U.K. remained unchanged at minus 29 in July, disappointing expectations for a reading of minus 28.
Sentiment on the pound remained fragile after data on Monday showed that U.K. mortgage approvals fell to the lowest level in 18 months in June, while a separate report showed that net lending grew at the slowest pace in 12 months in July.
Elsewhere, the greenback was higher against the yen, with USD/JPY adding 0.14% to hit 78.28, but edged lower against the Swiss franc, with USD/CHF easing 0.07% to trade at 0.9790.
Earlier in the day, government data showed that average cash earnings in Japan fell unexpectedly in June, ticking down 0.6%, while a separate report showed that household spending rose 1.6% in June, disappointing expectations for a 3% increase.
The data came after a report showed that manufacturing activity in Japan remained in contraction territory for the second consecutive month in July.
The greenback was fractionally lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD inching 0.01% lower to 1.0015, AUD/USD adding 0.06% to 1.0509 and NZD/USD edging up 0.03% to trade at 0.8092.
The National Bank of New Zealand said earlier that its index of business confidence rose to 15.1 in July, from a reading of 12.6 the previous month.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.01% to 82.86.
Markets were also looking ahead to the outcome of the Federal Reserve’s policy setting meeting on Wednesday, amid speculation over whether the bank will hint at further easing measures.
Later in the day, the U.S. was to release industry data on house price inflation, a report on consumer confidence and data on manufacturing activity in the Chicago area.
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