Investing.com - The U.S. dollar was broadly lower against the other major currencies on Tuesday, as market sentiment improved after the release of strong economic sentiment data from Germany and the euro zone. During European morning trade, the dollar was lower against the euro, with EUR/USD adding 0.25% to 1.3347. The euro erased earlier losses against the greenback after the ZEW Centre for Economic Research said that its index of German economic sentiment improved to 31.5 in January from a reading of 6.9 the previous month, blowing past expectations for a rise to 12.0. In addition, the ZEW Centre for Economic Research said that its index of euro zone economic sentiment jumped to 31.2 this month from 7.6 in December, compared with expectations for a reading of 14.0. Sentiment also strengthened after the eurogroup of euro zone finance ministers gave the green light on Monday for the payout of EUR9.2 billion to Greece this month, indicating greater confidence in Athens' ability to press ahead with initiatives outlined in the nation’s international aid program. But investors remained cautious, as euro zone ministers were still seeking an agreement on how and when the euro zone bailout fund, the European Stability Mecanism, can bypass governments and provide direct help to banks. The greenback was also lower against the pound, with GBP/USD easing up 0.09% to 1.5845. Official data earlier showed that public sector net borrowing in the U.K. declined less-than-expected in December, slipping to GBP13.2 billion from GBP14.3 billion the previous month. Analysts had expected public sector net borrowing to fall to GBP13 billion last month. Elsewhere, the greenback was lower against the yen, with USD/JPY tumbling 1.02% to trade at 88.70 and with USD/CHF dropping 0.35% to 0.9295. The yen strengthened broadly after the Bank of Japan said that from 2014 it would switch to an open-ended approach of buying a certain amount of assets each month without setting a deadline for completing the purchases. In addition, the BoJ doubled its inflation target to 2% in an effort to rid Japan of deflationary pressures, and left interest rates close to zero, as expected. The greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD slipping 0.11% to 0.9920, AUD/USD climbing 0.58% to 1.0576 and NZD/USD advancing 0.83% to 0.8429. The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.10% to 80.05. Later in the day, the U.S. was to publish private sector data on existing home sales. In addition, the World Economic Forum was to begin its annual meeting in Davos, Switzerland.

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