NEW YORK, June 23 (Reuters) - The U.S. dollar fell broadly on Tuesday as stabilizing equity markets in Europe and the United States eroded safe-haven flows into the greenback.
The euro jumped above $1.40 as financial markets awaited the outcome of a U.S. Federal Reserve policy meeting that concludes on Wednesday and a record $104 billion in U.S. debt issuance this week.
European shares were steady, while Wall Street was set to rise at the open, the day after the worst one-day loss in two months, encouraging investors to be a little less averse to risk.
"We have risk appetite back this morning, and the dollar is suffering on the back of that a little bit," said Jacob Oubina, currency strategist at Forex.com in Bedminster, New Jersey.
In early New York trading, the euro rose 0.9 percent against the dollar to $1.3987 after hitting a session peak of $1.4008, according to Reuters data.
The ICE Futures U.S. dollar index, which tracks the value of the greenback against a basket of major currencies, fell 0.7 percent to 80.316.
The focus is on the U.S. Federal Reserve's policy-setting Federal Open Market Committee, which begins its two-day meeting Tuesday, with a decision scheduled for Wednesday.
The market will be watching to see whether the central bank gives a slightly brighter economic view, while also watching whether it will address the recent rise in Treasury debt yields.
"Generally we are in a waiting phase ahead of the FOMC meeting," said Michael Klawitter, senior currency strategist at Dresdner Kleinwort in Frankfurt. "No one is willing to test the recent ranges in euro/dollar, though the pick-up in U.S. futures has lent some support to the euro."
Against the yen, the dollar was little changed at 95.84 yen, recovering from an earlier three-week low just below 95 yen, according to electronic trading platform EBS.
