(RTTNews) - The dollar barely budged versus most majors Wednesday morning, holding onto its recent gains against the euro amid further evidence that that Europe is lagging behind the global recovery.
Trading took place ahead of a busy day on the economic front here in the United States.
Federal Reserve Chairman Ben Bernanke will be presenting his semi-annual monetary policy testimony before the House Committee on Financial Services at 10.00 a.m. ET. An appearance before the Senate comes tomorrow. He is expected to provide clues on how the central bank intends to scale back measures implemented to prop up the economy.
As Bernanke takes to Capitol Hill, the Commerce Department will issue its report on new home sales for January at 10.00 a.m. ET. Economists expect that new homes sales increased to 355,000 during the month following an unexpected decline to 342,000 in December.
The housing market has show signs of stabilization following the worst downturn in decades, but with the lingering weakness plaguing the jobs market, the health of the broader economy is in question.
Still, traders are expressing more faith in the US recovery than the one chugging along across the Atlantic. With the euro area suffering anemic growth and significant debt problems, the dollar has risen to its highest level since last May against the euro.
The buck was steady near 1.3550 versus the euro, staying around last week's 9-month high of 1.3444. Over the last three months, the dollar has risen more than 15 cents from its 2009 lows.
Germany's economic recovery ground to a halt in the final quarter of 2009, as weak private consumption and investment offset a spike in exports, figures released by the government showed.
Gross domestic product in the largest euro area economy was flat in the three months through December period, the Federal Statistical Office said on Wednesday, confirming preliminary estimates.
The dollar also held its ground versus the sterling, staying within hailing distance of last week's 9-month high near 1.5342.
Against the yen, the buck stabilized near Y90 after seeing weakness in the previous session. Yesterday's disappointing US consumer confidence report fueled renewed interest in the yen as a safe haven play.
Even with oil prices steady above $79 the dollar extended its gains from the previous session versus the petro-linked loonie, rising to a 2-week high of C$1.0593.
