The U.S. dollar came under
pressure and traded lower against other major currencies on Tuesday,
as investors were positioning for a possible new round of monetary
easing.
The dollar dropped to the lowest level against the euro, which
received a boost after Germany's Constitutional Court confirmed that
the ruling on the permanent European bailout fund, the European
Stability Mechanism (ESM), will come out on Wednesday despite a new
court challenge.
Most investors expected that the court will not interfere with
the eurozone rescue plan, thus paving the way for further bailout
for those debt-ridden European countries.
Meanwhile, the dollar was weighed down as more and more investors
believe that the U.S. Federal Reserve would step up efforts to boost
the economy by announcing a new round of bond purchasing at the end
of its two-day policy meeting on Thursday.
Additionally, Moody's Investors Service said on Tuesday that it
would likely deprive the United States of its triple-A credit rating
if the U.S. Congress fails to reach a long-term debt reduction plan
next year.
In late Tuesday trading, the euro rose to 1.2860 dollars from
Monday's 1.2769. The British pound also went up to 1.6070 dollars
from 1.5998.
The dollar slipped to 0.9389 Swiss francs from 0.9464, and dipped
to 0.9733 Canadian dollars from 0.9776. And it bought 77.78 Japanese
yen as against 78.28 on Monday.
