Investing.com - The dollar was lower against the yen on Wednesday as traders locked in profits after the dollar rose to fresh three-and-a-half-year highs on Tuesday, while the euro was lower ahead of an Italian government bond auction.
During European morning trade, the dollar was lower against the yen, with USD/JPY down 0.30% to 95.79.
The yen's gains looked likely to remain limited as expectations for more aggressive easing measures from the Bank of Japan remained intact.
Japanese media reports on Tuesday suggested that BoJ governor nominee Haruhiko Kuroda could begin to implement fresh easing steps after he takes office next week and may not wait for the bank's upcoming policy meeting in early April.
The dollar pushed higher against the euro, with EUR/USD slipping 0.13% to 1.3016.
The euro remained under pressure ahead of an auction of three-year and 15-year Italian government bonds later in the session.
The auction was seen as an important test of investor appetite for the country's debt, as concerns over ongoing political uncertainty lingered following last month's inconclusive elections.
The dollar eased against the pound but remained close to two-and-a-half year highs, with GBP/USD rising 0.38% to 1.4958.
Sentiment on sterling remained weak after weak data on U.K. manufacturing and industrial output on Tuesday reinforced concerns over the possibility of a triple-dip recession and fuelled speculation that the Bank of England will restart its asset purchase program.
The greenback was little changed against the Swiss franc with USD/CHF inching up 0.01% to 0.9472.
The greenback was higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD rising 0.13% to 1.0268, AUD/USD slipping 0.13% to 1.0309 and NZD/USD down 0.21% to 0.8250.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, edged up 0.03% to 82.84.
Investors were looking ahead to U.S. data on retail sales later in the trading day as demand for the dollar continued to be underpinned by optimism that the economic recovery in the U.S. is gaining traction.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
