The U.S. dollar slipped against its major counterparts in European deals on Tuesday, as traders await minutes of the Federal Reserve’s October meeting, to be released on Wednesday.
The minutes of the October 28-29 meeting may give more details regarding the Fed’s termination of QE3 program but retaining the “considerable time” guidance.
The central bank in its statement assured that it will keep short-term interest rates near zero for a “considerable time.” Slack in labor market, falling energy prices, downward pressure on market expectations of inflation and signs of low inflation are expected give Fed some time wait before raising rates.
Traders await producer price inflation data for October and housing data for November, due shortly. Economists expect producer prices to rise 1.2 percent, slower than the 1.6 percent growth seen last month.
The National Association of Home Builders is scheduled to release the results of its homebuilder sentiment survey at 10 am ET. The consensus estimate calls for an increase in the index to 55 in November from 54 in October.
The greenback dropped to 0.9577 against the franc and 1.2539 against the euro, from early highs of 0.9653 and 1.2442, respectively. The next possible downside target for the greenback is seen around 0.95 against the franc and 1.26 against the euro.
Having advanced to a session’s high of 117.04 against the yen in early deals, the greenback pared some of its early gains and was trading at 116.56. The pair ended yesterday’s trading at 116.63.
The greenback slipped to 1.5671 against the Sterling and held steady thereafter. On the downside, 1.575 is seen as the next possible support level for the greenback.
U.K. inflation rose unexpectedly in October, while factory gate prices continued to decline, data from the Office for National Statistics showed.
Inflation rose to 1.3 percent in October from 1.2 percent in September. The rate was forecast to remain unchanged at 1.2 percent.
The material has been provided by InstaForex Company – www.instaforex.com