NEW YORK: The euro gained against the dollar on Tuesday after data showed improving German business morale, and as investors waited on comments from Federal Reserve Chairman Jerome Powell on Thursday about the US central bank's policy framework review.
A German business climate index rose more than expected in August as both manufacturing and services picked up steam, boosting hopes that Europe's largest economy is set for a strong recovery following the massive coronavirus pandemic shock.
The major focus for the dollar this week will be whether the Fed's Powell signals that the US central bank will shift its inflation target to an average. This would allow inflation to rise higher than previously before the Fed raises rates, which would be a further negative for the dollar.
The euro was last up 0.33% on the day at $1.1826, after reaching $1.1965 on Monday, the highest since May 2018.
The dollar index against a basket of currencies fell 0.21% to 93.08.
The Australian dollar rose 0.29% to $0.7182. The greenback rose 0.47% against the yen to 106.47 yen.
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