Forexpros – The U.S. dollar remained steady against its major counterparts on Tuesday, as market participants eyed U.S. economic data due out later in the day while market sentiment remained supported following a flurry of euro zone bond auctions.
During European afternoon trade, the dollar was slightly lower against the euro, with EUR/USD inching up 0.05% to hit 1.3162.
The euro remained supported after an auction of Dutch government debt met with solid investor demand, but fears that the country could lose its triple-A credit rating lingered following the collapse of the government on Monday.
Sentiment on the shared currency remained fragile after an auction of Spanish bills saw the country’s short-term borrowing costs almost double.
Spain sold EUR725 million of three-month bonds at a yield of 0.63%, up from 0.38% in March and EUR1.2 billion of six-month bonds at a yield of 1.58%, up from 0.83% last month.
The auction came one day after the Bank of Spain confirmed that country’s economy entered a recession in the first quarter, with gross domestic product contracting by 0.4% in the three months to March, following a contraction of 0.3% in the fourth quarter.
Meanwhile, Italy auctioned EUR3.34 billion of government bonds at the highest costs since January.
The greenback was close to a five-month low against the broadly stronger pound, with GBP/USD easing up 0.06% to hit 1.6140.
Official data showed that U.K. public sector borrowing rose more-than-expected last month, while the country’s debt-to-GDP ratio rose to a record high 8.3%.
The Office for National Statistics said public borrowing rose to GBP18.17 billion in March, from GBP17.95 billion a year ago, higher than expectations for an increase to GBP14.4 billion.
Sterling remained supported by diminished expectations for another round of monetary easing by the Bank of England.
Elsewhere, the greenback slipped lower against the yen and the Swiss franc, with USD/JPY inching down 0.01% to hit 81.17 and USD/CHF dipping 0.04% to hit 0.9131.
Switzerland’s trade surplus narrowed to CHF1.69 billion last month from CHF2.61 billion in February, as imports rebounded from the previous month’s steep drop.
The greenback was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD shedding 0.20% to hit 0.9893, AUD/USD slipping 0.21% to hit 1.0297 and NZD/USD edging up 0.06% to hit 0.8139.
In Australia, official data showed that consumer prices rose 0.1% in the first quarter, below expectations for a 0.7% rise, fuelling expectations for a rate cut by the Reserve Bank of Australia at next week’s policy meeting.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was lower by 0.07% at 79.42.
Later in the day, the U.S. was to release an industry data on house price inflation, as well a report on consumer confidence and government data on new home sales.