Greenback reasonably larger as markets put together for Fed

© Reuters. Dollar holds modest gains ahead of Fed policy decision

Investing.com – The dollar was moderately higher against the other major currencies on Wednesday, after the release of strong U.S. housing sector data, as investors grew cautious ahead of the Federal Reserve’s highly anticipated policy decision due later in the day.

was up 0.16% at 121.87.

The U.S. Commerce Department said that jumped 10.5% to hit 1.173 million units last month from October’s total of 1.062 million units. Analysts had expected a rise 6.6% to 1.135 million.

Meanwhile, the number of issued rose by 11.0% to 1.289 million units from October’s total of 1.161 million, easily surpassing market expectations for a decline of 1.0% to 1.150 million units.

A separate report showed that decreased 0.6% last month, disappointing expectations for a decline of 0.1

Most investors expect the U.S. central bank to raise interest rates for the first time since June 2006 at the conclusion of its meeting on Wednesday.

was steady at 1.0925, off session lows of 1.0913.

Eurostat reported earlier that rose 0.2% last month, up from a preliminary estimate of 0.1%. Euro zone inflation rose by 0.1% in October.

The rate has now been below 1% for 26 straight months, well under the European Central Bank’s target of near but just under 2%.

The report came after research group Markit said its , which measures the combined output of both the manufacturing and service sectors, eased down from 54.2 in November to 54.0 in December, below forecasts for 54.2.

Earlier Wednesday, Markit said its inched up to 53.0 this month from a final reading of 52.9 in November, while the preliminary services PMI dipped to 55.4 from 55.6.

Elsewhere, the dollar remained higher against the pound, with down 0.24% at 1.4999, while dropped 0.47% to 0.9868.

Sterling weakened after the Office for National Statistics said , excluding bonuses, rose just 2.0% in the three months to October, slowing from growth of 2.4% in the previous month.

, including bonuses, rose 2.4% down from 3.0% in the previous month.

The fell to 5.2%, the lowest level since January 2006, from 5.3% in the three months to September.

The number of people unemployed fell by 110,000, the biggest decline since the three months to September of last year, the ONS said.

The Australian dollar edged higher, with up 0.09% at 0.7199, while held steady at 0.6763.

Meanwhile, climbed 0.60% to trade at a fresh 11-1/2 year high of 1.3815.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.10% at 98.30.

Greenback reasonably larger as markets put together for Fed