Investing.com - The dollar was little changed against the euro on Tuesday following mixed economic data out of the euro zone and was trading close to two-and-a-half year highs against the yen.
During European morning trade, the greenback was fractionally lower against the euro, with EUR/USD inching up 0.07% to 1.3521.
The single currency pulled back from session highs after official data showed that euro zone retail sales dropped 0.8% in December, worse than expectations for a 0.5% fall, while November’s figure was revised lower.
The report came after data showed that the euro zone’s services purchasing managers’ index improved to a 10-month high of 48.6 in January from a final reading of 47.2 the previous month, adding to signs of recovery in the region.
The single currency remained under pressure as fresh political uncertainty in Spain and Italy revived fears over the debt crisis in the region, pushing peripheral borrowing costs higher and undermining investor confidence in the single currency.
The dollar was close to two-and-a-half-year highs against the yen, with USD/JPY rising 0.44% to 92.78.
The yen remained broadly weaker amid expectations that Japanese Prime Minister Shinzo Abe would keep pressure on the Bank of Japan to step up easing measures.
The greenback was slightly lower against the pound, with GBP/USD easing up 0.09% to 1.5776.
The pound hit session highs earlier after data showed that the U.K. service’s sector expanded at the fastest pace in four months in January, easing concerns over the economy falling back into a recession.
The Markit U.K. services PMI rose to 51.5 last month from a reading of 48.9 in December, outstripping expectations for a reading of 49.8.
Elsewhere, the greenback pushed higher against the Swiss franc, with USD/CHF rising 0.13% to 0.9094.
The Swiss franc was little changed after official data showed that Switzerland's trade surplus narrowed to CHF1.00 billion from a surplus of CHF2.90 billion the previous month.
The greenback was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.01% to 0.9986, AUD/USD down 0.38% to 1.0397 and NZD/USD edging up 0.09% to 0.8439.
The Australian dollar was weaker after the Reserve Bank of Australia left interest rates unchanged at 3% and indicated that the inflation outlook left scope to cut rates further in the coming months.
Meanwhile, official data showed that Australia’s trade deficit narrowed to a seasonally adjusted AUD0.43 billion from a deficit of AUD2.79 billion in December. Analysts expected a deficit of AUD0.80 billion.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, edged up 0.05% to 79.64.
The Institute of Supply Management was to publish a report on U.S. service sector activity later in the trading day.
