The dollar closed higher versus the euro in the first week of the year after the Federal Reserve suggested bond-buying operations may end in the middle of 2013 and concern grew the U.S. will struggle to reach a debt accord.
The dollar fell from a three-week high versus the euro after data showed the U.S. unemployment rate was higher than forecast in December, fueling bets the Federal Reserve won’t hurry to end its stimulus efforts.
The Canadian dollar fell from almost a two-week high against its U.S. counterpart as Bank of Canada Governor Mark Carney was named chief of the Bank of England, spurring speculation over who will replace him in Ottawa.
The euro reached the lowest level in almost three weeks amid a growing divide over Europe’s new bailout strategy and data that showed the region’s three-year- old sovereign-debt crisis is weighing on its economy.
Canada’s dollar climbed for a second day against its U.S. counterpart as a rebound in commodities following the steepest weekly slump since 2008 overshadowed the reduction of Greece’s credit rating by Standard & Poor’s.
The dollar dropped versus 13 of its 16 most-traded counterparts as speculation Europe’s debt crisis will ease and a report showing that U.S. unemployment-benefit applications fell spurred appetite for higher-yielding assets.