Forexpros – The euro was lower but steady against the dollar on Tuesday, dipping from earlier gains made on comments from Federal Reserve Bank of New York President William Dudley, who said the U.S. central bank hasn’t decided if the economy requires fresh easing measures.
In Asian trading on Tuesday, EUR/USD hit 1.3232, down 0.05%, up from a session low of 1.3230 and off from a high of 1.3243.
The pair was likely to test support at 1.3050, Friday’s low, and resistance at 1.3272, the high on March 9.
According to Dudley, U.S. monetary authorities have noted “signs that the economy is improving, do not dispel meaningful risks to growth including higher gasoline prices, fiscal cutbacks and a weak housing market.”
He also added the Federal Reserve could not rule out the possibility of rolling out stimulus measures to jolt the economy, including a third round of quantitative easing, which are asset purchases from banks that inject liquidity into the economy, weakening the dollar in the process.
The Fed has launched two rounds so far since the downturn, injecting trillions of dollars into the economy in the process.
Though there are no current plans to stimulate the economy via easing, it remains an option.
Meanwhile, a U.S. National Association of Home Builders/Wells Fargo report released Monday placed the builder sentiment index at 28 in February, the highest level since June 2007 but unchanged from January.
The news helped weaken the dollar against the euro, although the greenback bounced back in early Asian trading.
The euro, meanwhile, was up against the pound and up against the yen, with EUR/GBP trading up 0.01% at 0.8330 and EUR/JPY up 0.03% at 110.37.
Later Tuesday, Fed Chairman Ben Bernanke is to speak at an event in Washington.
Also on Tuesday, the U.S. will release data on building permits, an excellent gauge of future construction activity, as well as data on housing starts.
In Europe, Germany will release data on producer prices, a leading indicator of consumer inflation.
Switzerland, meanwhile, will release government data on industrial production.
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