LONDON—The dollar hovered near a nine-month low against the euro and surrendered recent gains against the yen on Tuesday, as traders weighed the risks of a U.S. recession against the outlook for Federal Reserve monetary policy.
Eurozone data on Tuesday reinforced the view that the economy is surviving a winter of intense price pressures reasonably well, analysts said.
The U.S. dollar index—which measures the greenback against a basket of six major currencies, fell 0.1 percent to 101.93, heading back towards the 7–1/2-month low of 101.51 reached last week.
“The U.S. is no longer the cleanest shirt in the global economic laundry,” said Ray Attrill, head of foreign-exchange strategy at National Australia Bank, who expects the dollar index to fall to 100 by end-March and the euro to rise to $1.10….