Forex – Dollar retreats in mid-day Asian trade

Forexpros – The U.S. dollar moved lower against its major counterparts in Asian trade Tuesday, as dealers took a dim view of comments by German officials regarding the upcoming meeting of European officials and the prospects for action on the euro-zone’s debt crisis.

In mid-day Asian trade, the greenback was down against the euro, with EUR/USD rising 0.17% to hit 1.3760.

On Monday, German Chancellor Angela Merkel’s spokesman Steffen Seibert dashed market hopes for an imminent solution to Europe’s two-year old debt crisis, saying Merkel had made it clear that, “dreams are taking hold now with this package, everything will be solved and everything will be over on Monday won’t be fulfilled.”

The process for an end to the crisis, “surely extends well into next year,” Seibert said at a news briefing from Berlin.

Over the weekend, the Group of 20 finance ministers and central bankers wrapped up talks in Paris, proposing a scheme to ward off Greek default, strengthen regional financial institutions and halt the spread of debt contagion.

Earlier in the day, the U.S. Federal Reserve reported that industrial production rose by a seasonally adjusted 0.2% in September, up from 0.0% in August and in line with market expectations.

On Wall Street, shares suffered from Merkel’s assessment of European debt, with the Dow Jones Industrial Average falling 2.13%, the Nasdaq Composite Index lost 1.98%, and the S&P 500 shed 1.94%.

Meanwhile, the greenback was lower against the British pound, with GBP/USD up by 0.25% to hit 1.5783.

The dollar was lower against both the Japanese yen and the Swiss franc with USD/JPY down 0.03% to hit 76.81, and USD/CHF down by 0.27% to hit 0.8968.

The greenback was lower against its Canadian, Australian and New Zealand counterparts with USD/CAD down 0.02% to hit 1.0231, AUD/USD higher by 0.24% to hit 1.0182, and NZD/USD rising 0.13% to hit 0.7925.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.21% at 77.37.

U.S. Federal Reserve Chairman Ben Bernanke was scheduled to deliver a speech at the Boston Fed’s economic conference in Boston later Tuesday.