Investing.com - The dollar traded lower against most major currencies on Tuesday due to soft durable goods orders, though an upbeat consumer confidence report brought the U.S. currency up from earlier lows.
Many investors avoid the greenback head of the Federal Reserve's Wednesday statement on monetary policy.
In U.S. trading on Tuesday, EUR/USD was up 0.29% at 1.2737.
The dollar slipped after data revealed that that U.S. orders for long-lasting manufactured goods, anything from toasters to airplanes, fell unexpectedly for a second consecutive month in September.
The U.S. Commerce Department reported earlier that total durable goods orders, which include transportation items, decreased by 1.3% last month, disappointing expectations for a gain of 0.5%.
Orders for durable goods in August were revised to a decline of 18.3% from a previously reported drop of 18.4%.
Durable goods are typically designed to last at three years and include trains, planes and automobiles.
Core durable goods orders, which are stripped of volatile transportation items and consist of components like household appliances, inched down by 0.2% in September, defying forecasts for a 0.5% gain. Core durable goods orders rose by 0.7% in August.
Orders for core capital goods, a key barometer of private-sector business investment, fell by 1.7% last month, worse than expectations for a 0.6% increase and after rising 0.3% in August.
Shipments of core capital goods, a category used to calculate quarterly economic growth, declined 0.2% in September, disappointing forecasts for a 0.7% gain, after rising 0.1% in the preceding month.
While demand for computers and machinery declined, a sign many firms are holding off on updating equipment to make sure the demand is there, demand for cars and trucks rose, which brought the dollar up from earlier lows as investors concluded that even if consumers aren't spending now, they remain poised to do so in the near future.
Elsewhere, the Conference Board reported earlier that its consumer confidence index jumped to 94.5 this month from 89.0 in September, boosted by a more favorable assessment of the current job market and business conditions.
Economists had expected the index to tick down to 87.0 this month.
The report left many investors concluding that while demand for goods and services in the U.S. remains cautious, consumers still remain upbeat over the U.S. economy and will ramp up spending soon.
Many investors jumped to the sidelines ahead of the Federal Reserve's statement on monetary policy on Wednesday.
The Fed is widely seen closing its bond-buying program, though uncertainty as to whether or not the statement will contain dovish or hawkish language surrounding interest rates prompted investors to avoid the greenback ahead of time.
The dollar was up against the yen, with USD/JPY up 0.32% at 108.16, and down against the Swiss franc, with USD/CHF down 0.26% at 0.9470.
The greenback was down against the pound, with GBP/USD up 0.08% at 1.6136.
The dollar was down against its cousins in Canada, Australia and New Zealand, with USD/CAD down 0.64% at 1.1176, AUD/USD up 0.66% at 0.8860 and NZD/USD up 0.41% at 0.7926.
The US dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.17% at 85.47.
On Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement. Expect the dollar to move on any indication as to when interest rates may rise in the U.S.