- POSTED: 01 Jan 2014 06:52
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The dollar inched up against the euro as it closed out 2013 on Tuesday, following encouraging US economic data on home prices and consumer confidence.
NEW YORK: The dollar inched up against the euro as it closed out 2013 on Tuesday, following encouraging US economic data on home prices and consumer confidence.
The euro fell to $1.3753 around 2200 GMT from $1.3800 at the same time on Monday.
The dollar also rose against the Japanese currency, buying 105.33 yen compared with 105.11 on Monday.
The euro, which becomes the shared currency of 18 European nations on Wednesday when Latvia joins the Eurozone, fell to 144.89 yen from 145.05.
Market conditions were choppy due to light volumes ahead of the New Year's Day holiday on Wednesday, said Omer Esiner of Commonwealth Foreign Exchange.
The dollar's gains came "thanks in part to an improving US economy and the prospect of reduced monetary stimulus from the Federal Reserve," Esiner said.
New data provided evidence of momentum in the world's largest economy. US consumer confidence rebounded in December after slumping in the prior two months. Home prices rose in October for the biggest annual gain since February 2006.
Analysts cautioned that the dollar could hit some bumps in 2014 as Federal Reserve tapers its asset-purchase program.
"The dollar may continue to give back the advance from back in October as the dovish twist to the Fed's forward-guidance limits the scope of seeing another taper at the January 29 meeting," said David Song, currency analyst at DailyFX.
Commonwealth's Esiner noted that the 16-day US government shutdown in October had negatively impacted dollar sentiment, but that conditions appeared to have improved in the fourth quarter.
"While year-end capital flows are likely skewing current valuations, the prospect of continued Fed tapering in 2014 remains a broadly positive scenario for the greenback," Esiner said.
The dollar rose to 0.8922 Swiss franc from 0.8877 franc Monday.
But it fell against the pound, which fetched $1.6570 compared with $1.6497 the prior day.