Dollar hovers near 22-month peak buoyed by strong US data

The dollar index versus a basket of six major currencies stood at 97.602 after rising to 97.777 overnight, its highest since June 2017.

Data showing sales of new U.S. single-family homes jumped to a near 1-1/2-year high in March on Tuesday added to recent positive readings in retail sales and exports.

The euro, which has the largest weighting within the dollar index, was a touch lower at $1.1219 after shedding 0.25 percent the previous day.

“The European economy looks particularly weak relative to the U.S. economy and this highlights the euro’s weakness, ” said Takuya Kanda, general manager at Gaitame.Com Research.

“The United States is now expected to have experienced firm growth in the first quarter, reinforcing the dollar’s strength relative to the euro.”

U.S. first quarter GDP data on Friday could strengthen the case that while the current period of global expansion is in its late stages, the United States is on a firmer footing compared with other leading economies.

The dollar was steady at 111.885 yen after suffering mild losses overnight, weighed by a decline in long-term Treasury yields.

The Australian dollar was little changed at $0.7097 following a loss of 0.5 percent the previous day ahead of the closely-watched domestic inflation report.

Australia’s first-quarter consumer price index (CPI) data is due at 0130 GMT and analysts polled by Reuters expect core inflation to come in around 1.7 percent — undershooting the central bank’s 2-3 percent target band.

The Canadian dollar struggled near a four-week low of C$1.3443 marked against the greenback overnight amid expectations that the Bank of Canada(BoC) would forgo language pointing to further interest rate hikes.

Canada’s central bank is expected to hold its benchmark interest rate steady at a policy meeting later on Wednesday. A Reuters poll showed that the central bank is seen standing pat on policy until the beginning of 2020 at the earliest.