By Investing.com

02 January 2018

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The dollar remained at three-month lows against other major currencies in quiet trade on Tuesday, as investors remained cautious for the first trading day of 2018.

The U.S. dollar weakened in 2017 as the global economy gained momentum fueling expectations for tighter monetary policy in other countries, which would lessen the divergence between the Federal Reserve and other central banks.

Market watchers were looking ahead to Wednesday’s minutes of the Fed’s December meeting for further hints on the future path of monetary policy, as well as the U.S. nonfarm payrolls report due on Friday.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.46% at 91.57 by 05:15 a.m. ET (09:15 GMT), the lowest since September 22.

The euro and the pound remained higher, with EUR/USD up 0.49% at 1.2064, the highest level since September 8 and not far from the two-and-a-half year peak of 1.2091 set that day, and with GBP/USD advancing 0.32% to 1.3546.

Data earlier showed that activity in the UK manufacturing sector slowed slightly in December, but continued to expand at a solid pace.

The yen and the Swiss franc were also stronger, with USD/JPY down 0.37% at 112.26 and with USD/CHF shedding 0.37% to 0.9713.

Elsewhere, the Australian and New Zealand dollars were higher, with AUD/USD up 0.35% at 0.7832 and with NZD/USD adding 0.14% to 0.7116.

Data on Tuesday showed that China’s Caixing manufacturing purchasing managers’ index rose to 51.5 last month from 50.8 in November, beating expectations for a downtick to 50.6.

China is Australia’s biggest export partner and New Zealand’s second biggest export partner.

Meanwhile, USD/CAD edged down 0.10% to 1.2538.

 

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This article was originally published at Investing.com.