Forexpros – The U.S. dollar was broadly higher against its major counterparts on Tuesday, as concerns over the deepening financial crisis in the euro zone bolstered demand for safe haven assets.
During European morning trade, the dollar was up against the euro, with EUR/USD shedding 0.58% to hit 1.3554.
Sentiment on the single currency soured as Italy’s 10-year bond yields neared 7%, also pushing Spanish 10-year yields above 6% for the first time since the European Central Bank started to buy the country’s bonds in August.
The euro remained lower after official data showed that Germany’s gross domestic product rose in line with expectations in the third quarter, expanding 0.5%, from an upwardly revised 0.3% in the preceding quarter.
France’s GDP expanded by 0.4% on the quarter, having contracted by 0.1% in the previous three months.
The greenback was also higher against the pound, with GBP/USD down 0.39% to hit 1.5849.
Earlier in the day, official data showed that consumer price inflation in the U.K. eased in October, ticking down to 5%, from a three-year high of 5.2% the previous month. Analysts had expected CPI to tick down to 5.1%.
Elsewhere, the greenback dipped against the yen but rallied against the Swiss franc, with USD/JPY inching down 0.03% to hit 77.03, and USD/CHF advancing 0.77% to hit 0.9152.
The greenback was also higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD climbing 0.55% to hit 1.0221, AUD/USD shedding 0.50% to hit 1.0153 and NZD/USD tumbling 1.08% to hit 0.7720.
Earlier Tuesday, the minutes of the Reserve Bank of Australia’s November policy meeting said the decision to cut interest rates earlier this month reflected a desire for a more neutral monetary policy, but added that there had been a case for keeping borrowing costs unchanged to await the effect of an ongoing mining boom.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.50% to hit 78.03.
Later in the day, the U.S. was to release official data on retail sales and producer price inflation, while the euro zone was to publish preliminary data on GDP growth and German economic sentiment.
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