The dollar gained from almost a one- month low versus the euro as concern a deal for Greece to buy back its bonds may falter while U.S. lawmakers struggled to reach a budget consensus boosted haven demand.
The Dollar Index rose to a two-month high as investors sought safety amid concern President Barack Obama will struggle to convince Congress to avert the so-called fiscal cliff after his historic re-election.
Foreign-exchange traders are putting their faith in Jean-Claude Trichet, betting the European Central Bank President will save the euro from a collapse predicted by everyone from George Soros to Paul Volcker.
The euro rose against most of its 16 major peers after two central bank officials said European Central Bank President Mario Draghi will announce unlimited sterilized bond buying to quell the region’s debt crisis.
The Australian dollar fell against most of its major counterparts, reaching its lowest level versus the U.S. dollar in more than seven weeks, as economic growth in the nation slowed more than forecast in the second quarter.