Dollar mostly higher as investors await European interest rate decisions

Shutterstock photo - The U.S. dollar was generally higher against its major rivals during Wednesday's Asian session as investors awaited earnings data from U.S. corporations and interest rate decisions from Europe's key central banks.

In Asian trading Wednesday the EUR/USD pair was off 0.04% to 1.3076. The pair will likely find support at 1.3025, Monday's low, and resistance at 1.3129, yesterday's high.

The greenback gained against the euro after data from the Eurozone indicated that the economy in the region may not be improving. The unemployment rate for the Eurozone came in at 11.8% on Tuesday, worse than the previous figure of 11.7%.

Elsewhere, the GBP/USD pair dropped 0.05% to 1.6047. The pair traded as high as 1.6069 and as low as 1.6044 during the session. The GBP/.USD is currently trading near short-term support, which is likely to be found at Friday's low of 1.6017.

The Bank of England is set to make a decision on interest rates Thursday. The current consensus estimate is for the central bank to leave rates unchanged at 0.50%. If the BoE takes aggressive steps to weaken the pound Thursday, investors might anticipate movement in the pair.

The U.S. dollar gained against the Japanese yen, with the USD/JPY rallying 0.49% to 87.47. Meanwhile, the AUD/USD fell 0.07% to 1.0495.

The strength seen in the yen is a reversal from very recent trends -- the USD/JPY was trading at 88.35 last Friday -- but resumes the general yen weakness that has occurred since the beginning of December.

The dollar also strengthend against its Canadian rival, with the USD/CAD rallying 0.07% to 0.9874.

U.S. stocks sold off during Tuesday's trading session, heighting the demand for the safe haven U.S. dollar. Geopolitical uncertainity and doubts about corporate earnings may have been affecting investor sentiment.

Questions about President Hugo Chavez's continued control of Venezuela were coupled with concerns about Japanese-Chinese relations.

In total, the U.S. dollar index gained 0.16% to 80.54 in Wednesday's Asian session. The index traded as high as 80.56 and as low as 80.41 - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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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.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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