Investing.com - The U.S. dollar was higher against the euro and the yen on Wednesday, as markets remained cautious ahead of a European Central Bank policy meeting on Thursday and expectations for further easing continued to pin the yen down.
During European afternoon trade, the greenback was higher against the euro, with EUR/USD sliding 0.18% to 1.3059.
The ECB was widely expected to hold off cutting rates following Thursday's policy meeting, but some market participants expected the bank to flag the possibility of rate cuts later in the year.
Meanwhile, official data showed that German industrial production rose 0.2% November, compared to expectations for a 1% increase, underlining concerns over the outlook for the region's largest economy.
The dollar gained ground against the yen to re-approach last week's two-and-a-half year highs, with USD/JPY up 0.58% to 87.55.
The yen remained under pressure amid expectations that Japan's new government will pressure the BoJ to step up monetary easing in order to spur growth and combat deflation.
The greenback was trading close to one-month highs against the pound, with GBP/USD down 0.26% to 1.6013.
In the U.K., official data showed that the trade deficit narrowed to GBP9.2 billion last month from GBP9.4 billion in October, as exports outstripped imports. Analysts had forecast a deficit of GBP9.1 billion.
The greenback pushed higher against the Swiss franc, with USD/CHF rising 0.18% to 0.9258.
The greenback was broadly lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD inching up 0.04% to 0.9870, AUD/USD easing up 0.13% to 1.0516 and NZD/USD rising 0.30% to 0.8390.
The Australian dollar came under pressure earlier in the day after official data showed that Australian retail sales fell 0.1% in November, disappointing expectations for a 0.3% increase.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.28% to 80.64.
Later Wednesday, the U.S. was to publish official data on crude oil stockpiles.
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