The U.S. Dollar stayed subdued against most of its major counterparts on Tuesday, ahead of the Federal Reserve’s monetary policy announcement tomorrow.
Markets largely shrugged off concerns about the debt woes of Chinese real estate major Evergrande, and focused on the monetary policy meetings of central banks in the U.S., Switzerland, the U.K. and Japan.
The Fed kicked off its two-day monetary policy meeting today, and is expected to hold its monetary policy unchanged. The central bank is likely to address the outlook for its asset purchase program.
The minutes of the Fed’s last meeting showed the Fed was prepared to begin scaling back asset purchases by the end of the year.
With some recent disappointing economic data suggesting the Fed could push back its plans, traders are likely to pay close attention to the wording of the post-meeting statement.
A report from the Commerce Department said housing starts jumped by 3.9% to an annual rate of 1.615 million in August from a revised rate of 1.554 million in July. Economists had expected housing starts to increase to a rate of 1.580 million from the 1.534 million originally reported for the previous month.
The Commerce Department also said building permits spiked by 6% to an annual rate of 1.728 million in August from a revised rate of 1.630 million in July. Economists had expected building permits to drop to a rate of 1.610 million from the 1.635 million originally reported for the previous month.
The dollar index, which slid to 93.05 in the European session, recovered and briefly emerged above the flat line by mid morning, but turned weak again. It is currently at 93.23, down marginally from the previous close.
Against the Euro, the dollar was up marginally at 1.1727.
The Pound Sterling was slightly up against the dollar, fetching $1.3661 a unit, compared to $1.3658 Monday evening.
The Yen firmed to 109.22 a dollar, gaining from 109.41.
Against the Aussie, the dollar strengthened to 0.7234 from 0.7252.
The Swiss franc firmed to 0.9236 a dollar, gaining from 0.9279.
The Loonie gained marginally against the dollar, advancing to C$1.2814 from C$1.2823.