Investing.com - The dollar slipped lower on Tuesday, as investors prepared for the Federal Reserve's policy meeting set to begin later in the day.
The Fed is widely expected to leave interest rates unchanged this week. However the U.S. central bank could give indications on when it plans to begin unwinding its balance sheet, as well as on any future interest rate decisions.
Investors were also eyeing U.S. data on building permits and housing starts due later Tuesday, for further indications on the health of the housing market.
The yen and Swiss franc were little changed, with USD/JPY at 111.63 and with USD/CHF at 0.9618.
Meanwhile, concerns over tensions between the U.S. and North Korea remained subdued, although they were susceptible to pick up at any moment.
U.S. President Donald Trump was set to address the United Nations General Assembly for the first time on Tuesday and Pyongyang was widely expected to be on the agenda.
The White House said in a statement that President Trump plans to call for international action to confront North Korea and Iran, which he will portray as twin threats to global security.
Elsewhere, EUR/USD gained 0.27% to 1.1987, while GBP/USD was almost unchanged at 1.3489, off the previous session's 15-month peak of 1.3619 following comments by Bank of England Governor Mark Carney saying that any pending interest rate rises over the coming months would be limited and gradual.
Sterling had rallied after Gertjan Vlieghe, an external member of the Bank of England's monetary policy committee, said on Friday that interest rates could rise “as early as in the coming months.”
The Australian and New Zealand dollars were stronger, with AUD/USD up 0.38% at 0.7990 and with NZD/USD advancing 0.40% to 0.7287.
Earlier in the day, the minutes of the Reserve Bank of Australia's September meeting showed that policymakers remained favorable to low interest rates, saying that they allowed the economy to continue to strengthen.
The central bank also cautioned against the current strength of the Australian dollar, saying its “appreciation over recent months, driven in part by a broad depreciation of the U.S. dollar, was weighing on domestic growth” and that a further appreciation could “result in a slower pick-up in growth and inflation.”
Meanwhile, USD/CAD slipped 0.15% to 1.2279.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.15% at 91.68 by 05:20 a.m. ET (09:20 GMT).