The dollar drifted lower against a basket of major counterparts on Wednesday, as a successful bond auction for Portugal boosted appetite for riskier assets.
The Fed’s Beige Book said this afternoon that the US economy strengthened in the final months of 2010, as the jobs picture brightened across the country.
The world was watching events in Europe again today, where Portugal was able to sell 1.25 billion euro in bonds despite lingering concerns it will inevitably default.
Borrowing costs on long-term notes declined, signaling confidence that the European Central Bank and other authorities are backstopping Portuguese debt.
Fellow debtors Spain and Italy will conduct closely-watched auctions tomorrow morning, ahead of the next interest rate decision from the ECB.
Here in the US, import prices jumped another 1.1 percent in December as energy costs continued to rise. Export prices rose 0.7 on-month.
The dollar dropped to $1.3120 against the euro, pulling back from a recent 4-month peak of $1.2873.
A monthly low was touched against the sterling, with the buck dropping to $1.5765.
Rising crude prices continued to drive the dollar lower against Canada’s resource-backed loonie. The buck dropped to a fresh 2-year low of C$0.9845.