Early trade in New York: FX volatility at Feb 2020 lows with dollar slightly up

NEW YORK: The US dollar edged up slightly and currency market volatility on Tuesday fell to its lowest level in more than a year, as investors sat on the sidelines waiting for clearer signals on central bank policy and inflation levels. With an impending European Central Bank meeting on Thursday and US inflation data due the same day, and a US Federal Reserve meeting next week, currencies appeared to be treading water while the S&P 500 dipped very slightly.

Range-bound currency markets mean a fall in volatility. The Deutsche Bank Currency Volatility Index hit its lowest level since February 2020.

The euro fell marginally as data showed German industrial production numbers declined in April.

The dollar index rose 0.15% to 90.107, while the euro fell 0.13% against the greenback at $1.2174.

The British pound fell 0.34% to $1.4126 and the Australian dollar eased 0.25% to $0.7735, with both stuck in ranges seen over the past couple of months.

Cryptocurrencies dropped but trading was generally calm. Bitcoin was last down 2.99% at $32592.63, while ether fell 5% to $2,457.78.