Forexpros – The U.S. dollar was higher against its major counterparts on Tuesday, as concerns over the handling of the debt crisis in the euro zone curbed demand for riskier assets.
During European morning trade, the greenback was up against the euro, with EUR/USD shedding 0.46% to hit 1.3680.
The single currency was weighed after Germany’s finance minister said on Monday that European leaders would not be able to present a definitive solution to the region’s debt crisis by the October 23 EU summit.
Also Tuesday, the ZEW Centre for Economic Research said that its index of German economic sentiment fell to its lowest level since November 2008, falling to minus 48.3 October from a reading of minus 43.3 in September.
Analysts had expected the index to decline to minus 45.0 in October.
The greenback was also up against the pound, with GBP/USD sliding 0.14% to hit 1.5725.
Earlier Tuesday, official data showed that the annualized rate of U.K. inflation rose to 5.2% in September, matching the record high hit in September 2008, fueling concerns that the U.K. economy may undergo a prolonged period of high inflation and low growth.
Meanwhile, the greenback was lower against the yen but higher against the Swiss franc with USD/JPY easing down 0.20% to hit 76.67 and USD/CHF rising 0.32% to hit 0.9020.
The greenback was up against its Canadian, Australian and New Zealand counterparts, with USD/CAD climbing 0.14% to hit 1.0251, AUD/USD slipping 0.16% to hit 1.0142 and NZD/USD sliding 0.42% to hit 0.7882.
Earlier in the day, the minutes of the Reserve Bank of Australia’s most recent policy meeting signaled a potential rate cut in the near future.
According to the report, RBA policymakers believed that “an improved inflation outlook, if confirmed by further data, would increase the scope for monetary policy to provide some support to demand, should that prove necessary.”
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.21%, to hit 77.69.
Later in the day, the U.S. was to release a government report on producer price inflation. Federal Reserve Chairman Ben Bernanke was also due to speak later Tuesday.
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