Summary Dollar slipped slightly on Monday as traders booked profits from last week's rally.
NEW YORK (AFP) - The dollar slipped slightly Monday as traders booked profits from last week s rally and lackluster US home sales data put pressure on the greenback.
Overhanging the market was anticipation of the Federal Reserve s decision Wednesday on interest rates, following a two-day meeting. While the Fed is expected to leave its near-zero rate unchanged, the focus will be on the post-meeting statement as traders hope to discern indications of when the hike is coming.
"Uncertainty over what the Fed would say this week about US interest rates tempted dollar bulls to cash out a few of last week s robust gains," said Joe Manimbo, senior market analyst at Western Union Business Solutions.
The euro rose to $1.1059 around 2100 GMT from $1.1016 at the same time Friday. Meanwhile, the dollar weakened to 121.07 yen from 121.46 yen.
Given a series of mixed US economic data, and last week s rate cuts by China and hints of further monetary policy stimulus from the European Central Bank, odds have fallen for liftoff at the central bank s December meeting.
Speculation is rising that the central bank will delay the move until March, or even later next year.
Omer Esiner of Commonwealth Foreign Exchange said that part of the dollar s weakness was due to the Commerce Department s "very negative" report on US new-home sales in September.
"Today s sharp 11.5 percent drop in new-home sales, which was the largest decline since July 2013, is a reminder of the vulnerabilities in the US economy," said Kathy Lien of BK Asset Management.
Esiner said that expectations for a Fed rate hike Wednesday were "very low."
"We ll see if their estimate of the economy has evolved and if the door is open for a December rate hike but any downside for the dollar is very limited by the ECB statements from last week," he said.
