Dollar turns broadly lower after German comments

Dollar turns broadly lower after German comments By Forexpros | Forex News | Sep 25, 2012 01:02PM GMT | Add a Comment ForexprosArticle Forexpros - The U.S. dollar was turned broadly lower against its major counterparts on Tuesday, following upbeat comments by Germany's Finance Minister Wolfgang Schauble, but sentiment remained under pressure amid uncertainty over the prospects for a Spanish bailout. During European afternoon trade, the dollar was higher against the euro, with EUR/USD rising 0.19% to 1.2955. Speaking during a visit to Helsinki, Mr. Schauble said European policymakers should do everything in their power to protect the single currency and said defending the euro was "worth any effort". But the euro remained under pressure following German media reports that lawyers for Germany's central bank are examining the legality of the European Central Bank's bond purchasing program, setting the stage for a possible legal challenge. Elsewhere, Spain saw borrowing costs rise at an auction of short-term debt earlier, reflecting lingering uncertainty over whether Madrid will request a full scale sovereign bailout. On Thursday Madrid is to present its draft budget for next year and announce structural reforms, while the results of bank stress tests are due on Friday. In addition, ratings agency Moody’s is expected to complete a ratings review on Spain later this week. Meanwhile, concerns over Greece continued to weigh, as Athens prepared to present a package of spending cuts at the end of this week, amid fears that the country’s budget shortfall could be larger than expected. The greenback was also lower against the pound, with GBP/USD adding 0.17% to 1.6246. In the U.K., data released by the British Bankers Association showed that the number of mortgage approvals rose unexpectedly in August. The BAA said mortgage approvals totaled 30,533 in August, up from an upwardly revised 28,800 in July. Economists had forecast approvals to fall to 28,600 in August. Elsewhere, the greenback was lower against the yen and the Swiss franc, with USD/JPY losing 0.15% to hit 77.74 and USD/CHF falling 0.24% to 0.9336. Speaking earlier, Swiss National Bank Chairman Thomas Jordan said it was still too early to say if the crisis in the euro zone is easing despite falling sovereign bond yields and reiterated that downside risks to the Swiss economy remain high. The greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD slipping 0.14% to 0.9774, AUD/USD rising 0.22% to 1.0447 and NZD/USD climbing 0.41%, to hit 0.8263. Official data showed earlier that Canada's core retail sales, which exclude automobiles, rose more-than-expected in July, ticking up 0.4% after a 0.4% decline the previous month. Retail sales rose 0.7%, beating expectations for a 0,3% increase and following a 0.3% fall in June. The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.21% to 79.42. Later in the day, the U.S. was to release data on house prices followed by a report on consumer confidence. In addition, European Central Bank President Mario Draghi was to meet with German Chancellor Angela Merkel in Berlin.