Investing.com - The dollar remained broadly lower against the other majors currencies on Wednesday, as investors grew more and more cautious ahead the Federal Reserve’s policy decision due later in the day.
The Fed is widely expected to hike rates for the first time in a year on at the conclusion of its meeting later Wednesday.
The U.S. central bank will also announce updated economic forecasts and markets will be watching closely for signals on the outlook for inflation and the expected pace of rate hikes in 2017.
Investors remained wary amid concerns that the Fed could strike a cautious tone on the outlook for policy tightening next year.
Higher rates boost the dollar by making the currency more attractive to yield-seeking investors.
Earlier Wednesday, the U.S. Commerce Department said retail sales ticked up 0.1% in November, disappointing expectations for a 0.3% gain.
Core retail sales, which exclude automobiles, gained 0.2% last month, compared to expectations for an increase of 0.4%.
Data also showed that U.S. industrial production fell 0.4% in November, compared to expectations for a 0.2% slip.
On a more positive note, the U.S. producer price index rose by 0.4% in November, beating expectations for a 0.1% uptick.
EUR/USD rose 0.28% to 1.0653, while GBP/USD gained 0.36% to trade at 1.2703.
Earlier Wednesday, the U.K. Office for National Statistics said the unemployment rate remained unchanged at an 11-year low of 4.8% in the three months to October, in line with forecasts.
The claimant count rose by 2,400 in November, compared to expectations for a increase of 5,500 people, and following an increase of 13,300 a month earlier.
Meanwhile, the average earnings index, including bonuses, rose by 2.5% in the three months to October, compared to forecasts for an increase of 2.3%.
Excluding bonuses, wages rose by 2.6%, beating forecasts for a 2.5% gain.
USD/JPY slipped 0.17% to 114.99, while USD/CHF shed 0.27% to 1.0094.
The Australian and New Zealand dollars remained stronger, with AUD/USD up 0.19% at 0.7515 and with NZD/USD gaining 0.32% to 0.7227.
Meanwhile, USD/CAD fell 0.27% to trade at a fresh two-month low of 1.3095.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.26% at 100.81, the lowest since December 8.