The yen held slightly weaker ahead of central bank board meeting minutes later on Tuesday and the Aussie tread water ahead of the latest interest rate review.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted up 0.08% at 98.98. USD/JPY last changed hands at 111.94, up 0.09%, while AUD/USD traded at 0.7529. up 0.04%.
In Asia, the Bank of Japan releases minutes from its March policy meeting and the Caixin manufacturing PMI for April is due with an expected level of 51.2. Later, the Reserve Bank of Australia releases its latest monetary policy review with most analysts expecting it to hold steady at a record low 1.5%.
Overnight, the dollar traded higher against a basket of major currencies on Monday, despite the release of downbeat economic data while bullish comments from U.S. Treasury Secretary Steven Mnuchin had little impact on the greenback.
In what was timid day of trading, as most of Europe observed Labour Day, the dollar pared losses sustained in early morning trade, despite bearish manufacturing and construction spending data.
The Institute for Supply Management (ISM) said its index of national factory activity dropped to a reading of 54.8 last month, the weakest reading since December, from 57.2 in March.
In a separate report, the Commerce Department said U.S. construction spending slipped 0.2 percent for the month of March. Analysts’ had forecast a slower decline to 0.4% from 1.8% a month earlier.
Elsewhere, U.S. Treasury Secretary Steven Mnuchin said on Monday, that it will probably take two years for the U.S. economy to achieve 3% growth, and highlighted the Trump administration’s tax reform and regulatory relief plans as key catalysts to induce economic growth.
“In our projections it will probably take two years to get up to three percent growth and then we can have a sustained level.” Mnuchin said.
Meanwhile, GBP/USD pulled back from six-month highs to trade at $1.2912, down 0.30%, after Brexit rhetoric began to surface, as news broke that European Union leaders are likely to demand that the UK agrees to pay its liabilities to the EU before a new trade deal can be discussed.
