Dollar Rises, EUR/USD Falls on Expectations ECB Will Stick to Policy Message

© Reuters. – The dollar rose against a basket of major currencies supported by euro weakness amid a report suggesting that the European Central Bank was unlikely announce plans to unwind its bond buying programme.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.29% to 90.39.

Reuters reported Tuesday, citing sources close to the ECB, that the central bank was at next week’s meeting, as inflation remains well below the 2% target.

The central bank’s inflationary concerns come ahead of Wednesday’s final reading on December inflation expected to confirm consumer prices grew 1.4%.

fell 0.24% to $1.2237.

, meanwhile, pared some of its losses against the greenback despite data showing annual than estimated in December. While investors also mulled over Prime Minister Theresa May’s comments insisting that the UK would definitely be leaving the European Union on 29th March 2019.

fell 0.02% in sideways trading ahead of the Bank of Canada’s policy meeting slated for Wednesday, when it is expected the central bank will raise rates by 0.25% to 1.25%.

The North American Free Trade Agreement (NAFTA) uncertainty has dominated Canadian dollar direction over the past week, Action Economics said, adding that it doesn’t expect the uncertainty, however, to weigh on the Bank of Canada’s interest rate decision.

rose 0.25% to Y110.80 as demand for safe-haven yen fell amid ongoing risk-on sentiment. The Bank of Japan’s surprise quantitative tightening announcement last week, however, limited gains in the pair.

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