Investing.com - The dollar rose to two-month highs against the other major currencies on Tuesday, as expectations for a June rate hike by the Federal Reserve continued to boost demand for the greenback.
USD/JPY rose 0.38% to 109.658.
The yen weakened after Japanese Finance Minister Taro Aso said on Tuesday that he must be extremely careful in discussing specific forex rates.
The remark came after earlier reports that he said it would be good if the dollar yen pair settled around 109 yen.
Meanwhile, the dollar remained broadly supported after St. Louis Fed President James Bullard said Monday that more factors favored a gradual rate increase versus keeping them steady.
Separately, San Francisco Fed President John Williams said he still sees the central bank raising interest rates two to three times this year.
EUR/USD declined 0.34% to a fresh two-month low of 1.1182.
The euro weakened after the ZEW Centre for Economic Research said its index of German economic sentiment declined to 6.4 this month from April’s reading of 11.2. Analysts had expected the index to rise to 12.0 in May.
The index of euro zone economic sentiment dropped to 16.8 in May from 21.5 a month earlier, missing forecasts for 23.4.
The dollar was lower against the pound, with GBP/USD up 0.65% at 1.4578 and was higher against the Swiss franc, with USD/CHF gaining 0.25% to 0.9920.
Sterling gained ground after the latest ORB poll, published in Tuesday's Telegraph newspaper, showed that the “Remain’ campaign has a 13-point lead over the ‘Leave’ campaign ahead of the June 23 referendum on Britain’s European Union membership.
Support for remaining in the EU stood at 55%, while support for Brexit was at 42%.
Meanwhile, the U.K. Office for National Statistics said public sector net borrowing came in at 7.2 billion in April, down 4.4% from a year earlier. Economists had forecast a shortfall of 6.6 billion.
The Australian and New Zealand dollars were weaker, with AUD/USD down 0.79% at 0.7166 and with NZD/USD retreating 0.50% to 0.6729.
Elsewhere, USD/CAD added 0.13% to trade at 1.3158, the highest since April 5.
The commodity currencies came under pressure as oil prices continued to decline on Tuesday, amid fresh concerns over a global supply glut.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.21% at 95.43, the highest since March 29.