Early trade in New York: Dollar rallies in thin trading

NEW YORK: The dollar rose on Tuesday in thin, choppy trading, as investors stepped back and assessed the implications of the US stimulus bill that Congress passed overnight and a coronavirus variant raging in Britain.

There seemed to be a risk-off tone in the market, with US stocks down except for Nasdaq, and US Treasuries rallying. Currencies associated with higher risk appetite such as the Australian and New Zealand dollars, as well as the euro and sterling were also weaker against the greenback.

Tuesday's data were weaker than expected, with US existing home sales falling more than expected in November and the consumer confidence index lower than forecast. Overnight, the US Congress passed a $892 billion COVID-19 aid package that aims to shore up the nation's pandemic response and bolster the battered economy.

In mid-morning trading, the dollar index rose 0.3% to 90.37, as the euro fell 0.2% to $1.2213. Sterling also slid against the dollar, down 0.9% at $1.3347. The pound sank versus the euro as well, down 0.5% at 91.44 pence per euro. The Australian dollar fell 0.7% to US$0.7532. The New Zealand dollar lost 0.8% to US$0.7040.