NEW YORK (AFP) — The dollar on Monday firmed slightly on better than expected US home-sales figures, but persistent concerns about the US economy still weighed on the greenback, dealers said.
Around 2200 GMT, the euro was at 1.4828 dollars, up from 1.4826 dollars in New York on Friday.
The dollar was at 108.07 yen, up from 107.14 yen.
The National Association of Realtors said January sales of previously owned homes dropped 0.4 percent from December to an annualized 4.89 million but this outcome, while very weak, was above the consensus forecast for 4.80 million.
"Existing-home sales fell less than expected in the month of January, which has helped the stock market rally and the US dollar rise against the Japanese yen," said Kathy Lien at Forex Capital Markets.
"However the dollar's recovery was limited to only the yen and Swiss franc because of the market's focus on risk appetite and problems within the existing home sales report."
The market awaited key reports on consumer confidence and producer prices Tuesday, as well as congressional testimony by Federal Reserve chairman Ben Bernanke on Wednesday and Thursday, to gain insight into the future direction of interest rates.
"We expect the dollar to rally on the back of stronger inflation numbers but weaker consumer confidence could cap the currency's rise," Lien said.
Most analysts expect the Fed to pare a half-point off its base federal funds rate at its March 18 meeting, following a series of cuts since September that have slashed the rate to 3.00 percent from 5.25 percent in a bid to ward off a recession in the world's biggest economy.
The current view is that the Fed will lower rates by at least another 0.75 percentage points over the next 12 months, taking the benchmark rate to 2.25 percent.
"Looking ahead, the US currency is likely to have trouble rising much further as long as investors remain focused on the US economic slowdown, the Federal Reserve's aggressive interest-rate cuts and many of the major foreign central banks' reluctance to match those moves with aggressive rate cuts of their own," said Patrick Fearon of AG Edwards.
Market players increasingly see the European Central Bank (ECB) cutting its 4.0 percent key rate as early as April, in the wake of the repeated Fed cuts.
In early February, the ECB repeated its focus on fighting inflation, while raising its level of concern over growth in the 15-nation bloc.
The European Commission last week lowered its eurozone growth estimate to 1.8 percent from a prior 2.2 percent.
In late New York trade on Monday, the dollar was at 1.0887 Swiss francs, down from 1.0850.
The pound was at 1.9670 dollars, up from 1.9662.
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