Dollar Rises Against Some Major Counterparts As Market Awaits Fed Announcement

(RTTNews) - The U.S. Dollar firmed against most of its major counterparts on Tuesday after data showed a bigger than expected increase in retail sales in the month of November. Investors also looked ahead to the Federal Reserve's monetary policy announcement, due on Wednesday.

The Fed is widely expected to lower rates by another quarter point. The focus is on the accompanying statement as well as officials' latest economic projections, including their forecasts for rates.

Recent data showing inflation remains sticky has led to some worries the Fed will lower rates slower than previously anticipated next year.

Data from the Commerce Department said retail sales in the U.S. grew by 0.7% in November after climbing by an upwardly revised 0.5% in October. Economists had expected retail sales to rise by 0.5% compared to the 0.4% increase originally reported for the previous month.

A report released by the Federal Reserve showed a modest decrease by U.S. industrial production in the month of November. The report said industrial production edged down by 0.1% in November after falling by a revised 0.4% in October.

Economists had expected industrial production to rise by 0.3% compared to the 0.3% dip originally reported for the previous month.

A report released by the National Association of Home Builders on Tuesday showed homebuilder confidence has held steady in the month of December. The report said the NAHB/Wells Fargo Housing Market Index came in at 46 in December, unchanged from November. Economists had expected the index to inch up to 47.

The dollar index, which climbed to 107.08 in the European session, dropped to around 106.75 around noon, but recovered gradually to 106.94, netting a marginal gain.

Against the Euro, the dollar strengthened to 1.0494 from 1.0514, and against Pound Sterling, firmed to 1.2715, gaining about 0.25%.

The dollar weakened against the Japanese currency, dropping to 153.48 yen a unit, from previous closing value of 154.15 yen. Against the Aussie, the dollar firmed to 0.6638 from 0.6371.

The dollar weakened against Swiss franc to CHF 0.8926, and against the Loonie, it climbed to C$ 1.4313 from C$ 1.4242.