Dollar Subdued Ahead Of Fed Policy

The U.S. dollar retreated after an early uptick and despite staging a mild recovery, was still moving below the flat line around late afternoon on Tuesday, ahead of the Federal Reserve’s monetary policy statement, due on Wednesday.

Data on U.S. consumer confidence and pending home sales too impacted dollar’s movements.

The dollar index was last seen hovering around 97.70. down 0.06% from previous close.

Against the Euro, the dollar was down at 1.1113, compared to previous close of 1.1101.

Against pound sterling, the dollar was little changed at 1.2863, after having weakened to 1.2905 earlier.

The Japanese yen was up marginally at 108.86 a dollar, as against 108.96 yen late Monday.

The Aussie was up nearly 0.4% with the AUD-USD pair at 0.6864.

The dollar was down marginally against Swiss franc at 0.9940, and up 0.25% against the loonie at 1.3087.

A report from the Conference Board said consumer confidence in the U.S. unexpectedly edged lower in the month of October, although the drop came from an upwardly revised level in the previous month.

The Conference Board said its consumer confidence index dipped to 125.9 in October from an upwardly revised 126.3 in September.

Economists had expected the consumer confidence index to climb to 128.5 in October from the 125.1 originally reported for the previous month.

A report released by the National Association of Realtors showed another significant increase in pending home sales in the U.S. in the month of September.

NAR said its pending home sales surged up by 1.5% 108.7 in September after spiking by 1.4% to a revised 107.1 August.

Economists had expected pending home sales to climb by 0.9% compared to the 1.6% jump originally reported for the previous month.

With the bigger than expected monthly increase, pending home sales in September were up by 3.9% compared to the same month a year ago.

The Federal Reserve is widely expected to cut interest rates by 25 basis points on Wednesday.

CME Group’s FedWatch Tool is currently pointing to a 97.3% chance that the Fed will lower rates by 25 basis points.

Meanwhile, in trade news, according to a report in Reuters, a phase one trade deal between the U.S. and China may not be signed by a summit in Chile next month.

The material has been provided by InstaForex Company – www.instaforex.com