Dollar mixed on home sales ahead of ECB statement, while markets keep eye on Greek debt issue

Dollar mixed on home sales ahead of ECB statement

NEW YORK — The dollar was narrowly mixed Tuesday after a report on the U.S. housing market showed some improvement, while investors remained concerned about Greece’s debt problems and looked ahead to the European Central Bank’s policy statement later this week.

The European Central Bank is expected to leave interest rates unchanged.

The National Association of Realtors said the number of people preparing to buy a home in the United States rose slightly in December, a sign that home sales could be stabilizing heading into the spring home buying season.

That news followed several reports Monday indicating that the U.S. economic recovery is on better footing than many had believed, pushing the dollar down as investors dumped the low-yielding currency for riskier bets.

In New York trading Tuesday, the 16-nation euro edged up to $1.3949 from $1.3923 late Monday. The euro had dropped to $1.3854 in Monday trading, its lowest point since mid-July.

Meanwhile, the British pound slipped to $1.5954 on Tuesday from $1.5961, while the dollar fell to 90.28 Japanese yen from 90.63 yen late Monday.

The euro has been weakened by concerns over the debt carried by Greece, Portugal and other European economies. The European Commission said Monday it will demand tougher measures such as new taxes and cutbacks if Greece doesn’t make progress getting its ballooning deficit under control.

Analysts, meanwhile, are widely expecting the ECB to keep interest rates unchanged when it meets Thursday, leaving the focus on its statements.

“The ECB meeting should be a non-event,” Calyon Credit Agricole analysts said in a research note. “While the refinance rate will be left unchanged, decisions regarding refinancing operations will be taken at the March policy meeting.”

Low interest rates can weigh down a currency as investors move funds to other currencies that have higher yields. The U.S. has one of the lowest official interest rates of the major economies, and many emerging-market countries have substantially higher rates.

Australia’s central bank left its key interest rate unchanged at 3.75 percent on Tuesday, surprising investors and analysts who had predicted the bank would continue raising the rate as the nation’s economy rebounds.

The Australian dollar fell to 88.25 U.S. cents from 89.10 cents in trading Tuesday in New York.

In other trading Tuesday, the dollar slid to 1.0607 Canadian dollars from 1.0634 Canadian dollars late Monday, and fell to 1.0556 Swiss francs from 1.0576 francs.