The dollar slipped lower against the yen and the euro on Tuesday, but it remained broadly supported by growing expectations for a December rate hike by the Federal Reserve and as growth concerns dented sentiment.
USD/JPY slipped 0.15% to trade at 122.92.
Markets were jittery after data on Tuesday showed that China’s manufacturing purchasing managers’ index ticked down to 49.6 last month from 49.8 in October. Analysts had expected the index to remain unchanged in November.
The disappointing data fuelled fresh concerns over a slowdown in the world’s second largest economy.
EUR/USD edged up 0.21% to 1.0588, barely off the previous session’s seven-month trough of 1.0556.
Sentiment on the euro remained vulnerable however, as the European Central Bank has been signalling over the past weeks that it is ready to add additional easing measures in order to boost inflation in the euro zone and support growth.
Meanwhile, speculation that the Federal Reserve will raise interest rates at its December meeting continued to lend broad support to the greenback.
Investors were eyeing a string of U.S. economic reports this week for further indications on the strength of the economy, as the Fed has said that any decision on interest rates will depend on data.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.20% at 100.07, still very close to Monday’s eight-month peak of 100.35.