Investing.com - The dollar was steady near last week’s more than four year highs against a basket of other major currencies on Tuesday after the Organization for Economic Co-operation and Development said the global economy will gradually improve over the next two years.
USD/JPY was down 0.12% to 118.12, off the lows of 117.68 struck earlier in the session.
The yen found some support after Bank of Japan Governor Haruhiko Kuroda voiced concerns over the economic impact of the weaker yen earlier Tuesday. The yen received an additional boost after the minutes of the BoJ’s October meeting showed that some officials opposed plans to expand its stimulus program.
OECD cut its forecast for economic growth in Japan this year and next after data last week showed that the country unexpectedly fell into a recession in the third quarter.
However, it noted that the weaker yen would help the recovery by boosting exports.
The think-tank said it still expects the global economy to grow by 3.3% this year and 3.7% in 2015.
The euro was little changed against the dollar, with EUR/USD at 1.2437, off Monday’s highs of 1.2443.
Data on Tuesday confirmed that Germany narrowly avoided a recession in the third quarter, posting economic growth of 0.1%. Consumer spending rose by 0.7%, while exports were 1.9% higher.
OECD warned that the euro area is at risk of deflation if growth stagnates or if inflation expectations continue to deteriorate and urged the European Central Bank to embark on quantitative easing measures.
Elsewhere, GBP/USD slid 0.19% to 1.5677, while USD/CHF was steady at 0.9667.
Investors were eyeing testimony by Bank of England head Mark Carney to parliament’s Treasury Committee.
The Australian and New Zealand dollars were sharply lower, with AUD/USD down 0.84% to 0.8543 and NZD/USD dropping 0.86% to 0.7792. USD/CAD was little changed at 1.1287.
The US dollar index, which tracks the performance of the greenback against a basket of six major currencies, was at 88.21, not far from last week’s more than four-year highs of 88.51.