Investing.com - The euro traded lower against the dollar on Monday as the greenback enjoyed broad support on expectations for a somewhat hawkish Federal Reserve statement on Wednesday, though mixed data chipped away at the U.S. currency's gains.
In U.S. trading, EUR/USD was down 0.13% at 1.2949, up from a session low of 1.2909 and off a high of 1.2972.
The pair was likely to find support at 1.2858, last Tuesday's low, and resistance at 1.2979, Friday's high.
The Federal Reserve will announce its latest statement on monetary policy this Wednesday, and expectations for the U.S. central bank to cut its monthly bond-buying program to $15 billion from $25 billion gave the dollar support on Monday as did expectations for an upbeat take on the U.S. economy.
Investors were also hoping to see a timetable as to when U.S. interest rates may rise, though a mixed bag of U.S. data trimmed the greenback's gains.
In a report, the Federal Reserve Bank of New York said that its general business conditions index increased to a five-year high of 27.5 this month from 14.7 in August. Analysts had expected the index to rise to 16.0 in September.
A separate report showed that U.S. industrial production fell 0.1% last month, disappointing forecasts for a 0.3% gain. Industrial production for July was revised down to a gain of 0.2% from a previously reported increase of 0.4%.
Elsewhere, the euro was up against the pound, with EUR/GBP up 0.08% at 0.7975, and down against the yen, with EUR/JPY down 0.28% at 138.80.
On Tuesday, the ZEW Institute is to release its closely watched report on German economic sentiment, a leading indicator of economic health.
The U.S. is to produce data on producer price inflation.