Forexpros – The U.S. dollar pushed higher against almost all of its major counterparts on Wednesday, as risk appetite was hit after a refinancing operation by the European Central Bank failed to ease investor concerns over the debt crisis in the euro zone.
During European afternoon trade, the dollar was higher against the euro, with EUR/USD shedding 0.20% to hit 1.3055.
The ECB allotted EUR489.19 billion in three-year loans to 523 European banks in an attempt to avert a liquidity crunch in the euro zone.
It is hoped that the funds may also be used by lenders to purchase the sovereign debt of indebted euro zone states, easing pressure on borrowing costs.
The amount allotted was the largest ever for a longer-term refinancing operation by the ECB and underlined concerns over the scale of the financial crisis in the euro zone.
But the greenback was lower against the pound, with GBP/USD adding 0.21% to hit 1.5695.
The Bank of England’s December meeting minutes showed that policymakers saw little change in the balance of risks to growth and said inflation may decline more slowly than expected.
Earlier Wednesday, a report by researchers GfK showed that consumer confidence in the U.K. weakened in December, hitting the lowest level since February 2009.
The greenback was almost unchanged against the yen but pushed higher against the Swiss franc, with USD/JPY dipping 0.01% to hit 77.88 and USD/CHF rising 0.20% to hit 0.9335.
The Bank of Japan kept its interest rate unchanged close to zero earlier, but downgraded its economic outlook from last month on mounting evidence of the effects of the euro zone’s debt crisis on global growth and Japan’s recovery prospects.
The greenback trimmed losses against its Canadian, Australian and New Zealand cousins after falling sharply earlier, with USD/CAD down 0.23% to hit 1.0272, AUD/USD up 0.32% to hit 1.0111 and NZD/USD rising 0.18% to hit 0.7693.
In Canada, official data showed that retail sales rose by a seasonally adjusted 1.0% in October, more than doubling expectations for a 0.4% gain.
Core retail sales, which exclude automobile sales, rose by a seasonally adjusted 0.7% in October, exceeding expectations for a 0.4% increase.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched up 0.02% to hit 80.25.
Later Wednesday, the U.S. was to produce industry data on existing home sales.
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