The US dollar remained under selling pressure on Tuesday as the single currency strengthened on umors that European leaders will reach at a decision to tackle the region’s debt crisis. The dollar index DXY which measures the US dollar’s performance against its six major rival currencies declined to 77.679 on Tuesday as compared to 78.213 on Monday’s North American trading session.
The euro gained to 1.3607 against the US dollar on Tuesday as compared to 1.3497 on Monday’s late trading hours.
Global head of currency strategy at Brown Brothers Harriman commented, “Risk appetite continues to recover off the back of hopes that euro-zone policy makers will soon begin to take bold measures to get ahead of the sovereign-debt crisis.”
Further, German Chancellor Angela Merkel assured that Germany will support Greece in a meeting with Greek Prime Minister George Papandreou. However some analysts had mixed opinions on solution of euro zone’s sovereign debt crisis. Currency strategist, Kathleen Brooks commented, “The market may have jumped the gun, while global officials may want to speed along a process to solve the sovereign-debt crisis, it appears that Europe is going to stay on its slow, plodding path.”
The US dollar further weakened after the release of S&P/Case-Shiller composite index according to which US home prices gained 0.9 percent for the month of July.
Against the British Pound, the US dollar fell to 1.531 as compared to 1.5541 on late Monday whereas surged versus the Japanese Yen to 76.71 as compared to 76.62 on Monday’s late trading hours.
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